Which of the Following Statements About the Impact of Treasury

question 144

Multiple Choice

Which of the following statements about the impact of treasury stock on the amounts reported on the balance sheet is correct?

• A) The balance in the treasury stock account increases paid-in capital.
• B) The balance in the treasury stock account reduces paid-in capital.
• C) The balance in the treasury stock account reduces total stockholders' equity.
• D) The balance in the treasury stock reduces retained earnings.

---

Definitions:

International Service

A type of service that is provided across national borders, catering to a global clientele.

Monetary Compensation

Payment given to employees as wages, salaries, bonuses, and commissions in exchange for their work.

Direct Payments

Financial transactions where funds are transferred from one party to another without intermediaries, often used in payroll or benefit disbursement.

Indirect Payments

Payments made on behalf of someone else, often seen in business where employers pay taxes or benefits to governments or insurance companies on behalf of employees.