Stock That Was Reacquired and Is Still Held by the Issuing

question 14

Multiple Choice

Stock that was reacquired and is still held by the issuing corporation is called:

• A)Capital stock.
• B)Treasury stock.
• C)Redeemed stock.
• D)Preferred stock.
• E)Callable stock.

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Definitions:

Bad Debts Expense

An estimated expense that represents accounts receivable that a company does not expect to collect.

Normal Balance

Normal balance refers to the side of the accounting equation on which increases to an account are recorded, which is debits for asset and expense accounts, and credits for liability, equity, and revenue accounts.

Allowance for Doubtful Accounts

An account that offsets assets, designed to predict the amount of a company’s accounts receivable that is likely to be uncollectible.

Normal Balance

The side (debit or credit) of an account that is positive or increasing in nature, depending on the type of account.