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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 (1) as the account to be debited 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.

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 (1) as the account to be debited 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.

College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)
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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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 (1) as the account to be debited 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 debited for the amount of $40,000
Cash Dividend debited for the amount of $200,000
Cash Dividends Payable debited for $40,000
Cash Dividends Payable debited for $200,000
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