Respuesta :
The dividend affect stockholders' equity for dates are :
December 15, Yr 1: Decrease.
December 31, Yr 1: No Effect.
January 12, Yr 2: No Effect.
Briefing :
When cash dividends are issued, the shareholders incur a responsibility since the dividends must be paid after they are declared. Retained profits must be debited at the declaration date, resulting in a drop in retained earnings. Because obligations are grown without commensurate increases in assets, the impact is a loss in total equity (assets - liabilities).
There is no entry at the balance sheet date, and there is no effect on equity. When the cash dividends are paid, the dividends payable account is debited and the cash account is credited. As a result, equity is unaffected at the payment date.
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