d . Retained Earnings
Dividends Payable
17 . Allstate , Inc ., has 10,000 shares of 6 %, $ 100 par value , cumulative preferred stock and 100,000 shares of $ 1 par value common stock outstanding at December 31 , 2007 . If the board of directors declares a $ 50,000 dividend , the
a . preferred stockholders will receive 1 / 10th of what the common stockholders will receive .
b . preferred stockholders will receive the entire $ 50,000 .
c . $ 50,000 will be held as restricted retained earnings and paid out at some future date .
d . preferred stockholders will receive $ 25,000 and the common stockholders will receive $ 25,000 .
18 . When a change in accounting principle occurs
a . prior years ' financial statements should not be changed to reflect the newly adopted principle .