Dividends

Question 1

JE

Answer 1

At declaration: Debit dividends declared (or RE)
Credit dividends payable
At payment: Debit dividends payable
Credit cash

Question 2

Property dividends

Answer 2

Step 1: mark the property to Fair Value
Step 2: record a gain or loss
Step 3: distribute the asset

Question 3

Scrip Dividend

Answer 3

Promise to pay a dividend at a later date. Can include interest on the outstanding dividend amount.
Debit dividends declared (or RE)
Credit Scrip dividends payable.
Interest is payed at payment.

Question 4

Liquidating dividend

Answer 4

When retained earnings is lower than the amount of dividends declared the remaining portion of the dividend is subtracted out of APIC. This is effectively a return of capital instead of a return on capital.