Sage Corporation has10,600shares of $100 par value,9%, preferred stock and50,100shares of $10par value common stock outstanding at December 31, 2017.

Answer the questions in each of the following independent situations.

(a)If the preferred stock is cumulative and dividends were last paid on the preferred stock on December 31, 2014, what are the dividends in arrears at December 31, 2017?

Amount of dividends in arrears

$

How should these dividends be reported?

The cumulative dividend is

reported

not reported

as a liability.

(b)If the preferred stock is convertible into 7 shares of $10par value common stock and4,300shares are converted, what entry is required for the conversion assuming the preferred stock was issued at par value?(Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation

Debit

Credit

(c)If the preferred stock was issued at $107per share, how should the preferred stock be reported in the stockholders' equity section?(Enter account name only and do not provide descriptive information.)

SageCorporation

Balance Sheet (Partial)

Current Assets

Current Liabilities

Intangible Assets

Long-term Investments

Long-term Liabilities

Paid-in Capital

Property, Plant and Equipment

Stockholders' Equity

Total Assets

Total Current Assets

Total Current Liabilities

Total Intangible Assets

Total Liabilities

Total Liabilities and Stockholders' Equity

Total Long-term Investments

Total Long-term Liabilities

Total Paid-in Capital

Total Property, Plant and Equipment

Total Stockholders' Equity

$