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The Shareholders' Equity Section of the Balance Sheet Reports the Sources

Question 25

Multiple Choice

The shareholders' equity section of the balance sheet reports the sources of financing provided by preferred and common shareholders and their claims on the net assets of the firm.Which of the following is/are true?


A) The equity of the preferred shareholders usually approximates the liquidation value of the preferred shares.
B) The equity of the preferred shareholders equals the sum of the amounts appearing in the Preferred Stock, Additional Paid-In Capital, Retained Earnings, Accumulated Other Comprehensive Income, Treasury Stock, and other preferred shares equity accounts.
C) The equity of the preferred shareholders equals the sum of the amounts appearing in the Preferred Stock, Additional Paid-In Capital, and Retained Earnings accounts, only.
D) The equity of the preferred shareholders equals the sum of the amounts appearing in the Preferred Stock and Additional Paid-In Capital accounts, only.
E) The equity of the preferred shareholders equals the amounts appearing in the Preferred Stock account, only.

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