Treasury stock is a stock issued by the us treasury

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Applied Calculus for the Managerial, Life, and Social Sciences
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Chapter 6 / Exercise 41
Applied Calculus for the Managerial, Life, and Social Sciences
Tan
Expert Verified
100.Treasury stock isa.stock issued by the U.S. Treasury Department.b.stock purchased by a corporation and held as an investment in its treasury.c.corporate stock issued by the treasurer of a company.d.a corporation’s own stock, which has been reacquired and held for future use.Ans: D, LO: 2, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Reporting, AICPA PC: None, IMA:Reporting101.The acquisition of treasury stock by a corporationa.increases its total assets and total stockholders’ equity.b.decreases its total assets and total stockholders’ equity.c.has no effect on total assets and total stockholders’ equity.d.requires that a gain or loss be recognized on the income statement.Ans: B, LO: 2, Bloom: C, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Reporting, AICPA PC: None, IMA:Reporting102.A corporation purchases 20,000 shares of its own $20 par common stock for $35 pershare, recording it at cost. What will be the effect on total stockholders’ equity?a.Increase by $700,000.b.Decrease by $400,000.c.Decrease by $700,000.d.Decrease by $300,000.Ans: C, LO: 2, Bloom: C, Difficulty: Medium, Min: 2, AACSB: Analytic, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Reporting, AICPA PC:Problem Solving, IMA: ReportingSolution: 20,000 $35 $700,000(sh. purch. cost/sh.)103.A corporation purchases 30,000 shares of its own $10 par common stock for $25 pershare, recording it at cost. What will be the effect on total stockholders’ equity?a.Increase by $300,000.b.Decrease by $750,000.c.Increase by $750,000.d.Decrease by $300,000.Ans: B, LO: 2, Bloom: C, Difficulty: Medium, Min: 2, AACSB: Analytic, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Reporting, AICPA PC:Problem Solving, IMA: ReportingSolution: 30,000 $25 $750,000(sh. purch. cost/sh.)
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Applied Calculus for the Managerial, Life, and Social Sciences
The document you are viewing contains questions related to this textbook.
Chapter 6 / Exercise 41
Applied Calculus for the Managerial, Life, and Social Sciences
Tan
Expert Verified
104.Treasury stock should be reported in the financial statements of a corporation as a(n)a.investment.b.liability.c.deduction from total paid-in capital.d.deduction from total paid-in capital and retained earnings.Ans: D, LO: 2, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Reporting, AICPA PC: None, IMA:Reporting105.A company would notacquire treasury stocka.in order to reissue shares to officers.b.as an asset investment.c.in order to increase trading of the company’s stock.d.to have additional shares available to use in acquisitions of other companies.Ans: B, LO: 2, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Legal/Regulatory Perspective, AICPA FC: None, AICPA PC: None, IMA:Business Economics

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