Dividends Payable

Code: 2154
👁 Views: 126

Account Information

Financial Statement Statement of Financial Position
Normal Balance Credit

Definition

Declared dividends due and payable to shareholders

Common Journal Entries

Declare dividends to shareholders

Dr. Retained Earnings
Cr. Dividends Payable

Pay dividends

Dr. Dividends Payable
Cr. Bank Account

Return unclaimed dividends

Dr. Dividends Payable
Cr. Retained Earnings

Transfer unclaimed dividends to reserve

Dr. Dividends Payable
Cr. Legal Reserve

Declare dividends to shareholders

Dr. Retained Earnings
Cr. Dividends Payable

Pay dividends

Dr. Dividends Payable
Cr. Bank Account

Return unclaimed dividends

Dr. Dividends Payable
Cr. Retained Earnings

Transfer unclaimed dividends to reserve

Dr. Dividends Payable
Cr. Legal Reserve

📐 IFRS vs US GAAP Accounting Treatment

IFRS IFRS 9 Financial Instruments
US GAAP ASC 405 Liabilities

❓ Frequently Asked Questions

Q: How are dividends payable recorded?

A: When dividends are declared: Dr. Retained Earnings, Cr. Dividends Payable. Upon payment: Dr. Dividends Payable, Cr. Bank.