Choco Delite Cookies Company (Choco) declared a $ 1,600,000 cash dividend on December 15, Year 2, pay-able to all stockholders on record the following month. On December 31, Year 2, the company completed a two-for-one stock split (Prior to the split there were 2 million common shares outstanding with a par value of $ 2). If Choco had net income of $ 3,000,000 for Year 2, what is the net journal entry impact on the company’s retained earnings account for December, assuming that Choco posts journal entries on a monthly basis and that temporary accounts are closed at year-end?
a. $ 3,400,000 credit ( net)
b. $ 1,600,000 debit ( net)
c. $ 3,000,000 credit ( net)
d. $ 1,400,000 credit ( net)