HANDOUT 11-2 CASH DIVIDENDS Jones Corp. has 200,000 shares of stock authorized, 120,000 shares issued, and 100,000 shares outstanding. On August 1, Jones' Board of Directors declared a cash dividend of $0.50 per share, with a record date of September 1. The dividend will be paid on October 1. Prepare the journal entries required to record the transactions described above, as needed, and then post them to the related T-accounts: Aug. 1 Sept. 1 Oct. 1 HANDOUT 11-3 PREFERRED DIVIDENDS On January 1, Garden State issued 10,000 shares of $10 par preferred stock for $19 per share. Prepare the journal entry required to record this transaction and post it to the appropriate T-accounts: Jan. 1 The stock pays a cumulative annual dividend of 7% of par value. What is the total amount of the annual dividends that would be paid, if declared to preferred stockholders? Complete the following table to explain how dividends would be allocated between preferred and common stockholders: Year Total Dividend To Preferred Stockholders To Common Stockholders Current $100,000 Year 2 5,000 Year 3 10,000 Year 4 None Year 5 20,000