When a Firm Purchases Its Own Shares as Treasury Stock

question 24

Multiple Choice

When a firm purchases its own shares as treasury stock:

• A)total stockholders' equity is decreased.
• B)total stockholders' equity is increased.
• C)retained earnings is decreased.
• D)paid-in capital is decreased.

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Definitions:

Proprioceptors

Sensory receptors found in muscles, tendons, and joints that provide information about body position and movement.

Muscle Spindles

Sensory receptors within the belly of a muscle that detect changes in muscle length, informing the central nervous system to maintain muscle tone and posture.

Thoracic Cavity

The chamber of the body of vertebrates that is protected by the thoracic wall and contains the lungs and heart.

Superior Right Shoulder

An anatomical reference to the upper part of the right shoulder, indicating a location above and to the right of the torso.