Redemption of Shares Generally Results in an Increase of Treasury

question 71

True/False

Redemption of shares generally results in an increase of treasury stock.

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Definitions:

Debt-Equity Ratio

The debt-equity ratio shows the comparative amount of shareholder equity and debt financing a company uses to support its assets.

Fully Depreciated

A state where a fixed asset has reached the end of its useful life and its book value is reduced to scrap value.

Profit Margin

A measure of a company's profitability, calculated by dividing net income by total revenues. It shows how much profit each dollar of sales generates.

Net Income

The total profit or earnings of a company after all expenses, taxes, and costs have been subtracted from total revenue.