3.

On December 31, 2020, Stanford, Inc. has 1,500 shares of 6% $100 par value cumulative preferred stock and 90,000 shares of $10 par value common stock outstanding. On December 31, 2020, the directors declare a $30,000 cash dividend. The entry to record the declaration of the dividend would include:

A)

a credit of $30,000 to Cash Dividends.

B)

a note in the financial statements that dividends of $3 per share are in arrears on preferred stock for 2020.

C)

a debit of $30,000 to Common Stock.

D)

a credit of $30,000 to Dividends Payable.