How will The Cheesecake Factory’s dividend announcement and payment impact its balance sheet? Original blog posting (November 29, 2016)

The Cheesecake Factory October 26, 2016, declared a cash dividend of $0.24 per share Payable on November 22, 2016 to shareholders of record as of November 9, 2016 Over 200 restaurant locations As of the end of fiscal 2015, 91,126,667 shares outstanding

Question 1 When does this dividend become a liability for Cheesecake Factory?

Question 2 What is the total amount of the dividend that Cheesecake Factory will pay out (assuming no change in the number of shareholders since fiscal year end 2015)?

Question 3 How would Cheesecake Factory’s assets, liabilities, and equity be impacted on the date of declaration?

Question 4 How would Cheesecake Factory’s assets, liabilities, and equity be impacted on the date of payment?

Question Recap When does this dividend become a liability for Cheesecake Factory? What is the total amount of the dividend that Cheesecake Factory will pay out (assuming no change in the number of shareholders since fiscal year end 2015)? How would Cheesecake Factory’s assets, liabilities, and equity be impacted on the date of declaration? How would Cheesecake Factory’s assets, liabilities, and equity be impacted on the date of payment?

For additional news stories to use in the accounting classroom, see the Accounting in the Headlines blog at http://accountingintheheadlines.com/ Questions or comments? Contact Dr. Wendy Tietz at wtietz@kent.edu