Which of the following is a current liability?
A)Preferred dividends in arrears
B)A dividend payable in the form of additional shares of stock
C)A cash dividend payable to preferred stockholders
D)All of these

Question

Quizplus · Accepted Answer

A current liability is a debt or obligation that is expected to be settled within one year or within the company's normal operating cycle. Preferred dividends in arrears are not currently due and are not considered a current liability. A dividend payable in the form of additional shares of stock is not a liability, but rather a stock-based compensation. However, a cash dividend payable to preferred stockholders is a current liability because it represents an obligation to pay out a certain amount of cash within a year.

Which of the Following Is a Current Liability