Answer to Question #149996 in Finance for Pooja ...

Question #149996
Define and identify the type of Income / Expenses
- Treatment of the Income / Expenses in the Profit and Loss account, Impact of the
Income / Expenses in the Balance Sheet.
You purchased 10 shares of L& T Company last year. On 5th March 2019, the company has declared a dividend Rs 50 per share. The income is earned but not yet collected in your account during this financial year.
1
Expert's answer
2020-12-10T14:29:40-0500

The two accounts involved in transaction one is Dividend Income (as dividend is declared), the other one is Dividend Receivable (as it is not yet collected in the account)

Impact on the Income statement - Increase in Income - as Dividend Income $500

Impact on the Balance Sheet - Increase in Current Assets - as Dividend Receivable $500


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