How do I enter dividend?

How do I enter dividend?

For dividend processing we do the following.
set aside the value into a dividend account.
next a approved amount will be taken from the dividend account and moved to a dividend payable account.
finally payment is made against this dividend payable account.

Each company may have different steps in processing this.
the follow is a example of our method.

Step 1.
After processing the Year end closing  the company will decide a value to be set aside for dividend.
during the allocation phase, value is removed from retained earnings to be set aside in the dividend account.






Step 2.
the company will next decide how much to payout this period.
this value is taken from the dividend account and moved to the dividend payable account.






Step 3.
Payment to the shareholders.
payment is done against the dividend payable account.


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