Journal entries associated with a cash dividend are usually made on which of the following dates?

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The question asks about the dates on which journal entries for a cash dividend are typically made. 
Option 1: 'Record date and payment date.' The record date is when the company determines which shareholders are eligible to receive the dividend; there is usually no journal entry on this date related to cash dividends, since no liability or payment occurs yet. The payment date, however, would involve a journal entry to record the cash outflow, but pairing it with the record date makes this option inaccurate for the common two-step journal entry process. 
Option 2: 'Payment date only.' If you only record on the payment date, you neglect the recognition of the dividend liability that occurs at declaration. Standard practice requires recognizing a liability at declaration, so this option is incomplete. 
Option 3: 'Declaration date and payment date.' This option aligns with typical accounting for cash dividends: at declaration, the company creates a liability (Dividends Payable) and reduces Retained Earnings; at payment, the liability is settled by cash. This reflects the two-stage process of recognizing a dividend obligation and then settling it. 
Option 4: 'Declaration date and record date.' While the declaration date is correct for creating the liability, the record date is about which shareholders are entitled to receive the payout and does not involve a cash dividend journal entry. Therefore, pairing declaration with the record date omits the actual cash payment event. 
In sum, the only choice that matches the standard journal-entry sequence for cash dividends—recognizing the liability on declaration and settling it on payment—is Option 3: 'Declaration date and payment date.'

COMM_V 320 DD4 2025W1 Part A Final Exam December 15, 2025 Part A Multiple Choice - 30 minutes

Journal entries associated with a cash dividend are usually made on which of the following dates?

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