Calypso Inc

question 75

Multiple Choice

Calypso Inc.issues 100,000 shares at $10 / share in January.Later that year the company is able to repurchase 9,000 of these shares at $11 per share.The balance in the contributed surplus account is $0 prior to the share repurchase.The effect of this is

• A)a decrease to the share capital account of $99,000.
• B)an increase to the contributed surplus account of $9,000.
• C)a increase to total shareholders' equity of $99,000.
• D)a decrease in retained earnings by $9,000.

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Definitions:

Renunciation

The act of formally or officially giving up a right, position, or responsibility, often in a legal or ceremonial context.

Statutory Right

A right granted by legislation, which is enacted by a legislative body.

Intestate

The state of dying without having made a legal will, leading to the distribution of one's estate according to state or country laws.

Distributed

The process of allocating or dispersing items, resources, or information among multiple recipients or over various locations.