Final answer:
Cumulative preferred stock descriptions on the balance sheet typically include the par value, the number of shares authorized, issued, and outstanding, and the amount of the dividend. Therefore, all of the items are included in the balance sheet description.
Step-by-step explanation:
When describing cumulative preferred stock within the stockholder's equity section of the balance sheet, it is typical to include various details that provide a clear understanding of the stock's characteristics and the firm's obligations to preferred shareholders. Those details normally incorporate:
- The par value of the stock, which is the nominal value as stated in the corporate charter.
- The number of shares authorized, issued, and outstanding, offering a picture of how many shares the company can sell, has sold, and are currently held by investors.
- The amount of the dividend that is promised to the preferred shareholders, which is a significant aspect of preferred stock as these dividends are typically accumulated if not paid out when due.
Thus, the correct answer to the student's question is d. All of the items are included in the description shown on the balance sheet.