The following information is available about a company’s dividends:
                                                                                                                                  $
2005
Sept.                Final dividend for the year ended
                        30 June 2005 paid (declared August 2005)                                   100,000
2006
March              Interim dividend for the year ended
                        30 June 2006 paid                                                                            40,000
Sept.                Final dividend for the year ended
                        30 June 2006 paid (declared August 2006)                                     120,000
What figures, if any, should be disclosed in the company’s income statement for the year ended 30 June 2006
and its balance sheet as at that date?
I     ncome statement                         Balance sheet
         for the period                                   liability
A   $160,000 deduction                        $120,000
B   $140,000 deduction                                   nil
C   nil                                                    $120,000
D   nil                                                               nil

D