What would be the journal entry to record:

Sept 28, 2009 A dividend was declared, which they intend to pay at $0.10 per
share by the end of the year.
The company has 25,000 shares of capital stock

To record the journal entry for the declaration of a dividend, you will need to make two entries: one to recognize the liability and the other to record the reduction in retained earnings.

1. Recognizing the liability:
Date: September 28, 2009
Account Title: Dividends Payable
Debit: ($0.10 x 25,000 shares) = $2,500
Credit: Dividends Payable

2. Reducing retained earnings:
Date: September 28, 2009
Account Title: Retained Earnings
Debit: Retained Earnings
Credit: ($0.10 x 25,000 shares) = $2,500

Explanation:

1. Recognizing the liability:
The first entry debits the Dividends Payable account to recognize the liability the company owes to its shareholders. The amount is calculated by multiplying the dividend per share ($0.10) by the number of shares outstanding (25,000).

2. Reducing retained earnings:
The second entry debits Retained Earnings to reduce its balance. This reduction represents the declaration of dividends, which decreases the company's equity. The credit reflects the same amount calculated as in the first entry ($0.10 x 25,000 shares).

By making these journal entries, you record the declaration of the dividend and establish a liability to pay the dividend to the shareholders.