On 1 November 2016,Oster Company Declared a Dividend of $4

question 12

Multiple Choice

On 1 November 2016,Oster Company declared a dividend of $4.75 per share.Oster Ltd has 20,000 ordinary shares outstanding and no preference shares.The date of record is 15 November and the payment date is 30 November 2016.Which of the following is the journal entry needed on 30 November?

• A)debit Dividends payable,ordinary $95,000 and credit Cash $95,000
• B)debit Cash $95,000 and credit Dividends payable,ordinary $95,000
• C)debit Retained earnings $95,000 and credit Cash $95,000
• D)debit Retained earnings $95,000 and credit Dividends payable,ordinary $95,000

---

Definitions:

Leveraged Buyouts

The acquisition of a company using a significant amount of borrowed money (debt) to meet the purchase cost.

Zero Bonds

Bonds that do not pay interest periodically but are sold at a deep discount from their face value, with the interest effectively accruing and being paid at maturity.

RRSP Account

A Registered Retirement Savings Plan in Canada that offers tax benefits to individuals saving for retirement.

Interim Interest

Interest that is calculated and charged in the period between the closing of a loan and the first scheduled payment date.