Question Details

acquisition of treasury stock




1.	Each of the following is correct regarding treasury stock except that it has been
a.	issued.
b.	fully paid for.
c.	reacquired.
d.	retired.



	2.	Treasury stock is
a.	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 but not retired.



	3.	The acquisition of treasury stock by a corporation
a.	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.


	4.	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.



 
	5.	A company would not acquire treasury stock
a.	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.









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