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

question 161

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. Which of the following is the journal entry needed to record the declaration of dividends?

• A) Debit Dividends payable $60,000 and credit Retained earnings $60,000.
• B) Debit Retained earnings $60,000 and credit Cash $60,000.
• C) Debit Retained earnings $60,000 and credit Dividends payable $60,000.
• D) Debit Cash $60,000 and credit Dividends payable $60,000.

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