**Question:**Cumulative preferred dividends in arrears should be shown in a corporation’s balance sheet as:- ○ A footnote- ○ An increase in current liabilities- ○ An increase in current liabilities for the current portion and long-term liabilities for the long-term portion- ○ An increase in stockholders' equity

The cumulative preference shareholders have the right to receive any arrears of dividend also.

Answered: Cumulative preferred dividends in…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Cumulative preferred dividends in arrears should be shown in a corporation's balance sheet as: O A footnote An increase in current liabilities O An increase in current liabilities for the current portion and long-term liabilities for the long-term portion O An increase in stockholders' equity