Which of the Following Balance-Sheet Accounts Will Not Be Affected

question 61

Multiple Choice

Which of the following balance-sheet accounts will not be affected when there is a reduction in the number of outstanding shares?

• A) Retained earnings
• B) Additional paid-in capital
• C) Common shares (valued at par value)
• D) Treasury shares at cost

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Definitions:

Seller

An individual or entity that offers goods or services for sale to consumers or other businesses.

Operating Expenses

Costs incurred in the day-to-day operations of a business, such as rent, utilities, and salaries, excluding the cost of goods sold.

Gross Profit

The difference between sales revenue and the cost of goods sold, indicating the margin earned before accounting for operating expenses.

Sales

Transactions where goods or services are provided in exchange for payment.