In the shareholders' equity section of the statement of financial position,
A)Common Stock Dividends Distributable will be classified as a contra account to Retained Earnings.
B)Common Stock Dividends Distributable will appear in its own subsection of shareholders' equity.
C)Preferred and Common Shares appear under the subsection Share Capital.
D)Dividends in Arrears will appear as a restriction of Retained Earnings.

Question

Quizplus · Accepted Answer

Preferred and Common Shares are typically classified under the subsection Share Capital in the shareholders' equity section of the statement of financial position. Common Stock Dividends Distributable and Dividends in Arrears are not typically classified in their own subsections but may be included as a contra account to Retained Earnings.

In the Shareholders' Equity Section of the Statement of Financial