Which Statement Is Correct About the "Two Transaction Method" for Treasury

question 36

Multiple Choice

Which statement is correct about the "two transaction method" for treasury shares resold for greater than their repurchase cost?

• A)This method decreases the contributed surplus when the repurchased shares are later resold.
• B)This method has the same effect on contributed surplus to that of the two transaction method.
• C)This method treats the reacquisition and subsequent sale as one cycle for accounting.
• D)This method increases contributed surplus at the time of repurchase.

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