Repurchasing Shares

question 45

Multiple Choice

Repurchasing shares

• A)increases the number of shares outstanding.
• B)decreases the number of shares outstanding.
• C)has no effect on the number of shares outstanding.
• D)splits shares in half.

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Definitions:

Partnership Net Income

The total profits earned by a partnership that are to be divided among partners in agreed-upon proportions.

Equity

The amount of funds contributed by owners (shareholders) plus the retained earnings (or losses), representing ownership interest in a firm.

Capital Balances

The amount of money that the partners or owners of a business have contributed or acquired through retained earnings.

Partnership Liabilities

The debts and obligations for which a partnership is legally responsible, typically shared among the partners according to their agreement.