Response to the following :
Dividend Closing Entry(ies)
Refer to the data in problem. Make the necessary journal entry(ies) to close the dividend accounts to retained earnings at the end of the year.
Problem:
Dividend Declaration Accounting
The company has the following two types of stock:
1. 2,000 shares of 10% cumulative preferred stock with a $20 par value.
2. 5,000 shares of common stock with a $1 par value.
The company declared a $21,000 cash dividend. Make the necessary journal entry(ies) to record this event.