Muscat Mills Company is having 6,000 stocks of 12%, OMR10 par value, non-cumulative, Irredeemable preferred stock outstanding as on 1st Jan 2017

Accounting Nov 16, 2020

Muscat Mills Company is having 6,000 stocks of 12%, OMR10 par value, non-cumulative, Irredeemable preferred stock outstanding as on 1st Jan 2017. The company at the end of the year had excess profits and decided to announce dividends for preferred stock which was finally paid on 10th Jan. 2018. what will be the journal entry for payment of preference dividend on the date of payment?

Cr. Retained earnings OMR 7200 Cr. Preference dividend Payable OMR 7200

Dr. Retained earnings OMR 7200 Dr. Preference dividend Payable OMR 7200

Dr. Bank OMR 7200 Cr. Preference Dividend Payable 7200

Dr. Preference Dividend Payable OMR 7200 Cr. Bank OMR 7200

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