Jameson Company Earned Net Income of $75,000 During the Year

question 63

Essay

Jameson Company earned net income of $75,000 during the year ended December 31,2018.On December 20,Jameson declared the annual cash dividend on its 8% noncumulative preferred stock (par value,$150,000)and a $0.50 per share cash dividend on its common stock (45,000 shares).Jameson then paid the dividends on January 10,2019.
Prepare the journal entries to record the declaration and the distribution of the dividends.Explanations are not required.

---

Definitions:

Owner Drawings

Owner Drawings are withdrawals of business assets by the owner(s) for personal use, affecting the owner's equity account but not considered business expenses.

Revenues

The total amount of money received or expected to be received from the sale of goods or services, as well as other financial sources.

Net Income

The company's ultimate income after expenses and taxes have been taken away from total earnings.

Electronic Repair Revenues

Income generated from the business of fixing and restoring electronic devices and components to working condition.