Which of the following statements is true with regard to preferred stock (preference shares)?
A. Most preferred stock (preference shares) is reported under U.S. GAAP as debt.
B. Most preferred stock (preference shares) is reported under IFRS as equity.
C. Under U.S. GAAP, mandatorily redeemable preferred stock is reported as equity.
D. Under IFRS, preferred stock dividends are reported in the income statement as interest expense.
Answer: D
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