On November 1, 2014, Oster Company Declared a Dividend of $3.00

question 30

Multiple Choice

On November 1, 2014, Oster Company declared a dividend of $3.00 per share. Oster Company has 20,000 shares of common stock outstanding and no preferred stock. The date of record is November 15, and the payment date is November 30, 2014.
-Which of the following statements is TRUE about the date of record?

• A) No journal entry is made on the date of record.
• B) The liability must be recorded on the date of record.
• C) Cash is disbursed to shareholders on the date of record.
• D) The company transfers cash to a brokerage firm on the date of record.

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Definitions:

Inflation

The rate at which the general level of prices for goods and services is rising, eroding purchasing power.

Consumer Price Index

A measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care, used to estimate cost of living changes.

Market Basket

A selected group of goods and services used to track inflation and other economic indicators through price changes.

Base Year

A specific year against which economic growth is measured, serving as a standard point of comparison for real economic calculations such as GDP.