Dividends to Preferred Stockholders Are Deducted from Net Income When

question 186

Multiple Choice

Dividends to preferred stockholders are deducted from net income when calculating the return on common stockholders' equity ratio because

• A)dividends are not an expense on the income statement.
• B)the ratio is an indicator of the return on "common" stockholders' equity,not the return on preferred stock.
• C)dividends are only available for distribution to common stockholders.
• D)conservatism indicates that shareholders prefer a smaller numerator.

Comprehend the purpose and structure of a trial balance and its role in the accounting cycle.

Distinguish between different types of errors that can affect the trial balance and understand their implications.

Identify and classify accounts as assets, liabilities, and equity and understand their role in the accounting equations.

Explain the functions and differences between ledgers and charts of accounts.

---

Definitions:

Pedophiles

Adults who are sexually attracted to prepubescent children, a condition classified as a psychiatric disorder.

Non-Right Handedness

The characteristic of using the left hand more proficiently than the right hand for daily activities.

Cortical Deficits

Impairments in the function or structure of the brain's cortex, potentially affecting cognitive, sensory, or motor functions.

Chemical Castration

The administration of medication designed to reduce libido and sexual activity, often used as a treatment for sex offenders.