Which of the Following Is the Correct Order of Accounts

question 157

Multiple Choice

Which of the following is the correct order of accounts in the stockholders' equity section of the balance sheet? (Assume preferred stock is issued at par.)

• A) Common stock, Preferred stock, Paid-in capital in excess of par, Retained earnings.
• B) Common stock, Paid-in capital in excess of par, Preferred stock, Retained earnings
• C) Preferred stock, Paid-in capital in excess of par, Common stock, Retained earnings
• D) Preferred stock, Common stock, Paid-in capital in excess of par, Retained earnings

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Definitions:

Ineffective

Not producing the intended or desired effect.

Economic Cost

The total cost of choosing one action over another, including both direct costs and any lost opportunity costs.

Utility

The satisfaction or benefit derived from consuming goods and services.

Earning Power

The ability of an individual, company, or entity to generate income over time, often assessed for future potential.