Accounting entries associated with a cash dividend usually are made on which of the following dates?
A)Record date and payment date.
B)Payment date only.
C)Declaration date and record date.
D)Declaration date and payment date.

Question

Quizplus · Accepted Answer

Accounting entries associated with a cash dividend are usually made on the declaration date and payment date. On the declaration date, the board of directors declares the dividend, creating a liability for the company. On the payment date, the company pays out the dividend to its shareholders, reducing the liability. Thus, the correct choice is D, which includes both the declaration date and payment date.

Accounting Entries Associated with a Cash Dividend Usually Are Made