The board of directors of Yancey Company declared a cash dividend of $1.50 per share on 42000 shares of common stock on July 15 2021.The dividend is to be paid on August 15 2021 to stockholders of record on July 31 2021.Recording the transaction on July 15 2021 will include a(n)

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On July 15, 2021, the board of directors of Yancey Company declared a cash dividend of $1.50 per share on 42,000 shares of common stock. This means that the company owes its shareholders $63,000 ($1.50 x 42,000). To record this transaction, the company will increase its liability account - Dividends Payable - by $63,000. This is because, at this point, the company owes the dividend to its shareholders, but the payment has not been made yet. There will be no effect on cash at this point because the payment will be made on August 15, 2021. Therefore, the correct answer is B - increase to Cash Dividends.

The Board of Directors of Yancey Company Declared a Cash