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:

Interest Annually

The amount of interest earned or paid over a one-year period.

Debt to Assets Ratio

A financial ratio that indicates the percentage of a company's assets financed by debt.

Current Assets

Resources anticipated to be turned into cash, disposed of, or utilized within a year or during the operational cycle, whichever period extends further.

Total Liabilities

The combined amount of obligations a company owes to external parties, including loans, accounts payable, mortgages, deferred revenues, and accrued expenses.