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25th TT: Dividends to Shareholders (O146 E)

The board of directors has made the decision to pay dividends to shareholders and it has been announced to them. Therefore the company is committed to pay dividends and this obligation has to be duly recorded. There is a profit balance 732,032 after paying taxes, as shown the Accounting System > Group 9 > WorkSheets Y4. The board has considered that sales are now picking up, costs are manageable and that a dividend payment 400,000 will not put the company in any risk of illiquidity.

The entries for this transaction in the four financial statements are as shown in 

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