Anthem Inc

question 187

Multiple Choice

Anthem Inc.issues 200,000 shares of stock with a par value of $0.01 for $150 per share.Three years later,it repurchases these shares for $80 per share.Anthem records the repurchase in which of the following ways?

• A)Debit Common Stock for $2,000,debit Additional Paid-in Capital for $29,998,000 and credit Cash for $30 million.
• B)Debit Treasury Stock for $16 million and credit Cash for $16 million.
• C)Debit Common Stock for $2,000,debit Additional Paid-in Capital for $15,998,000 and credit Cash for $16 million.
• D)Debit Stockholders' Equity for $30 million,credit Additional Paid-in Capital for $14 million and credit Cash for $16 million.

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Definitions:

Degrees of Freedom

The number of independent values or quantities which can vary in the calculation of a statistic.

Critical Value of F

The threshold value determined from an F-distribution, given a certain significance level, used in analysis of variance (ANOVA) to decide whether to reject the null hypothesis of equal variances.

Predictor Variables

Variables in a statistical model that are used to predict or explain changes in the response variable.

Value

Refers to the importance, worth, or usefulness of something, often determined by its desirability, utility, or contribution to achieving a goal.