1) The financial statements of a corporation that failed during the current year to pay any dividends on its cumulative preferred stock should:
a) Include the amount of the omitted dividends among its current liabilities.
b) Include a footnote disclosing the amount of the dividends in arrears.
c) Show the amount of the omitted dividends as a deduction from retained earnings.
d) List the omitted dividends as a long-term liability.
