1 When common stock is issued at an amount greater than par value, the difference between the par value and the proceeds from the sale is recorded by crediting an additional paid-in capital account x debiting an additional paid-in capital account crediting the common stock account crediting the retained earnings account Which of the following statements is true regarding dividends on preferred stock? Preferred shareholders are guaranteed an annual dividend. X Preferred dividends in arrears are either a current or long-term liability, depending upon when the corporation last declared a dividend. Preferred shareholders will receive a dividend if common shareholders are paid. Preferred dividends in arrears are a current liability. Which one of the following statements is not true? The total amount of shareholders' equity is unaffected by the method used to account for treasury stock. Treasury stock transactions may result in an increase to retained earnings. X The treasury stock account is treated as a contra-shareholders' equity account. Treasury stock transactions do not result in gains or losses on the income statement. 3 4 A construction project is expected to take two-and-a-half years to complete. Partial Billings is less than Construction in Progress. The two accounts are reported together on the balance sheet in the current assets section. X long-term liabilities section. long-term assets section. current liabilities