A company declared a $0.50 per share cash dividend. The company has 20,000 shares authorized, 9,000 shares issued, and 8,000 ordinary shares. The journal entry to record the dividend declaration is:
A) Debit Retained Earnings $4,000; credit Ordinary Dividend Payable $4,000.
B) Debit Ordinary Dividend Payable $4,000; credit Cash $4,000.
C) Debit Retained Earnings $4,500; credit Ordinary Dividend Payable $4,500.
D) Debit Ordinary Dividend Payable $4,500; credit Cash $4,500.
E) Debit Retained Earnings $10,000; credit Ordinary Dividend Payable $10,000.
Correct Answer:
Verified
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