Which of the Following Statements Regarding Repurchased Stock Is True

question 23

Multiple Choice

Which of the following statements regarding repurchased stock is true?

• A)It is generally less costly for a company to give employees repurchased shares than to issue new shares.
• B)When a company records a stock repurchase,it is tracking a stockholder's sale of stock to another investor.
• C)Treasury stock is reported on the balance sheet as an asset.
• D)Treasury stock is repurchased stock that has been authorized but is not issued.

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Definitions:

Constructively

refers to a legal interpretation where an action or condition is treated as existing by virtue of a legal fiction, even if not in actuality.

Bailment

Bailment describes the process of placing personal property into the temporary custody or care of another, with the expectation of its return.

Real Property

Land and anything permanently affixed to it, such as buildings and natural resources.

Personal Property

Items or assets that can be moved and are not fixed to one location, unlike real estate.