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

question 159

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.

---

Definitions:

Morphine

A powerful opiate analgesic drug derived from the opium poppy used to relieve severe pain.

Opiates

A group of drugs derived from the opium poppy, used medicinally for pain relief but having a high potential for dependence and abuse.

Endorphins

Natural painkillers produced by the body, often associated with feelings of euphoria.

Proinflammatory Cytokines

Molecules produced by the immune system that promote inflammation and are involved in the body's response to disease and injury.