When a cash dividend is paid to shareholders, this is known as the payment date. This is the date when the actual cash is transferred from the company to the shareholders. Since the dividend liability was previously recorded on the dividend declaration date, then the entry would be to debit dividend payable and credit cash (for the cash outflow).
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What is the journal entry to record a dividend payable?
Learn More Home What exactly are Dividends Payable? This question unfolds once a corporation’s board of directors approves and declares a proposed cash dividend, setting the stage for distributing dividends to shareholders. Are Dividends Liabilities? Despite the cash remaining within the company at the time of declaration, declaring a dividend requires a new entry on...
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What is a dividend?
A dividend is when a company distributes profits to its shareholders. Typically, dividends are in the form of cash and are distributed when the company has excess cash that is not reinvested into the business. A company can also issue a stock dividend or property dividend.
What is the journal entry to record a dividend payable?
Learn More Home What exactly are Dividends Payable? This question unfolds once a corporation’s board of directors approves and declares a proposed cash dividend, setting the stage for distributing dividends to shareholders. Are Dividends Liabilities? Despite the cash remaining within the company at the time of declaration, declaring a dividend requires a new entry on...
What is a dividend?
A dividend is when a company distributes profits to its shareholders. Typically, dividends are in the form of cash and are distributed when the company has excess cash that is not reinvested into the business. A company can also issue a stock dividend or property dividend.
