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.The effects of recording the declaration of the dividend on July 15 2021 are to

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When the board of directors declares a dividend, it creates a liability for the company to pay out the dividend to its stockholders. As a result, stockholders' equity is decreased because the company is distributing some of its profits to its stockholders. Therefore, the correct option is A, which indicates that the declaration of the dividend will decrease stockholders' equity and increase liabilities.

The Board of Directors of Yancey Company Declared a Cash