Porter Corp

question 12

Multiple Choice

Porter Corp.purchased its own par value shares on January 1, 2015 for $20,000 and debited the treasury shares account for the purchase price.The shares were subsequently sold for $12,000.The $8,000 difference between the cost and sales price should be recorded as a deduction from

• A)share premium-treasury to the extent that previous net "gains" from sales of the same class of stock are included therein; otherwise, from retained earnings.
• B)share premium-treasury without regard as to whether or not there have been previous net "gains" from sales of the same class of shares included therein.
• C)retained earnings.
• D)net income.

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Definitions:

NLRA Deregulation

Efforts or proposals aimed at reducing the government rules and restrictions associated with the National Labor Relations Act, which governs labor relations in the United States.

Voluntarism

The principle or practice of relying on voluntary action (rather than state intervention) in social and economic matters, including labor relations.

Shareholder Model

A corporate governance framework where the interests of shareholders are the primary focus of company management.

Stakeholder Model

A framework in business and ethics that emphasizes considering the interests and impacts on all affected parties (stakeholders) rather than solely focusing on shareholders.