On which financial statement would the dividends account appear?
Understand the Problem
The question is asking which financial statement includes the dividends account. This relates to understanding the presentation of financial information within accounting statements.
Answer
Statement of cash flows and statement of retained earnings.
The dividends account appears on the statement of cash flows and the statement of retained earnings.
Answer for screen readers
The dividends account appears on the statement of cash flows and the statement of retained earnings.
More Information
Dividends are reported in multiple statements. While the actual disbursement is shown in the statement of cash flows, the impact on equity is shown in the statement of retained earnings and stockholders' equity.
Tips
A common mistake is to confuse dividends with expenses; dividends are distributions to shareholders, not expenses.
Sources
- On which financial statement would the Dividends account appear - Homework Study - homework.study.com
- Where do dividends appear in the financial statements? - AccountingTools - accountingtools.com
- Do Dividends Go on the Balance Sheet? - Investopedia - investopedia.com
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