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In the stockholders' equity section of the balance sheeta. Common Stock Dividends Distributable will be classified as part of additional paid-in capital.b. Common Stock Dividends Distributable will appear in its own subsection of the stockholders' equity.c. Additional Paid-in Capital appears under the sub-section paid-in capital.d. Dividends in Arrears will appear as a restriction of retained earnings

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Answer: Option C

 

Explanation: In simple words, stockholders equity refers to the amount of funds that a company have collected by selling its ownership rights in the market.

Paid in capital refers to that subsection which depicts the amount of share capital for which the consideration expected has been received. Additional paid in capital is the amount by which the issue price of a share exceeds its par value.

Thus, it is also a stockholders equity and the amount of funds will ultimately be received by the company.

Hence from the above we can conclude that the correct option is C.

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