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On which of the three cash-dividend dates is NO journal entry recorded?
ADate of payment
BDate of declaration
CDate of record
DDate of authorisation
Answer & Solution
Correct answer: C. Date of record
1. On the declaration date, a liability is created (debit cash dividends, credit dividends payable).
2. On the payment date, the liability is settled (debit dividends payable, credit cash).
3. The record date only fixes who owns the shares; nothing changes in the accounts.
4. Therefore no journal entry is made on the date of record.
_Source: Jonick, Principles of Financial Accounting (CC BY-SA 4.0), §6.5 "Cash Dividends", p.253_
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