Answered: Sunshine Corp. was organized on Jan. 1…

College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)

22nd Edition

ISBN:9781305666160

Author:James A. Heintz, Robert W. Parry

Publisher:James A. Heintz, Robert W. Parry

Chapter20: Corporations: Organization And Capital Stock

Section: Chapter Questions

Problem 1MP: Stockholders equity accounts and other related accounts of Gonzales Company as of January 1, 20--,...

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Question

Sunshine Corp. was organized on Jan. 1 with authorization of 20,000 shares of $5 preferred stock, $100 par, and 200,000 shares of $25 par common stock. Indicate the account on Dec. 1 that should be recorded in the Description column of the Journal item (2) as the account to be credited and the amount assuming that Sunshine Corp. declared the annual dividend on the preferred stock with 8,000 shares of the preferred stock having been issued. Sunshine Corp. is not declaring a dividend on the Common Stock.

JOURNAL page 32

date	description	p.ref.	debit	CREDIT
Dec. 1	(1)		?
	(2)			?

Group of answer choices

Cash Dividend credited for the amount of $40,000

Cash Dividend credited for the amount of $200,000

Cash Dividend Payable credited for $40,000

Cash Dividend Payable credited for $200,000

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