Which of the Following Account Groups Includes Nominal Accounts

question 185

Multiple Choice

Which of the following account groups includes nominal accounts?

• A) Cash, Dividends, Wages Payable
• B) Prepaid Insurance, Equipment, Fees Earned
• C) Common Stock, Dividends, Net Income
• D) Rent Revenue, Fees Earned, Miscellaneous Expense

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Definitions:

Dividends In Arrears

Dividends on preferred stock that have not been paid by the declaration date but are still owed to shareholders.

Non-Cumulative

Pertaining to preferred stock, which does not accumulate unpaid dividends if they are not declared.

Preferred Stock

A class of ownership in a corporation that has a higher claim on its assets and earnings than common stock, often with fixed dividends.

Treasury Stock

Shares that were issued and subsequently reacquired by the issuing corporation, reducing the number of shares outstanding in the market.