When Treasury Stock Is Purchased for an Amount Greater Than

question 167

Multiple Choice

When treasury stock is purchased for an amount greater than its par, what is the effect on total shareholders' equity?

• A) Increase.
• B) Decrease.
• C) No effect.
• D) Cannot tell from the given information.

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Definitions:

Small Business Administration

The Small Business Administration is a U.S. government agency established to support the growth and development of small businesses through loans, loan guarantees, counseling, and other assistance programs.

Government Lender

A governmental entity or agency that provides loans or financial assistance to individuals, businesses, or other organizations.

Government Lending Programs

Financial programs sponsored by governmental entities to provide loans to individuals or businesses for various purposes.

Small Businesses

Companies with a small number of employees and relatively low volume of sales, often privately owned.