Multiple Choice
A company purchased treasury stock for $19,000. The treasury stock was initially issued for $12,000 and had a $5,000 par value. Which of the following statements correctly describes the effects of the treasury stock purchase?
A) Net income increases by $7,000.
B) Net income decreases by $7,000.
C) Stockholders' equity increases $12,000.
D) Stockholders' equity decreases $19,000.
Correct Answer:
Verified
Correct Answer:
Verified
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