On 1 November 2014, Oster Company Declared a Dividend of $3.00

Multiple Choice

On 1 November 2014, Oster Company declared a dividend of $3.00 per share. Oster Company has 20 000 shares of ordinary shares outstanding and no preference shares. The date of record is 15 November, and the payment date is 30 November 2014. Which of the following is the journal entry needed on 30 November?

A) Debit Dividends payable $60 000 and credit Cash $60 000.
B) Debit Cash $60 000 and credit Dividends payable $60 000.
C) Debit Retained earnings $60 000 and credit Cash $60 000.
D) Debit Retained earnings $60 000 and credit Dividends payable $60 000.