Which Statement Best Explains the "Single Transaction Method" for Treasury

question 28

Multiple Choice

Which statement best explains the "single transaction method" for treasury shares?

• A)This method treats the reacquisition as the end of the initial share issuance transaction.
• B)This method treats the subsequent sale as the start of another transaction.
• C)This method treats the reacquisition and subsequent sale separately for accounting.
• D)This method treats the reacquisition and subsequent sale as two parts of the same transaction.

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Definitions:

Acquisition

The process of gaining control, ownership, or a significant amount of shares of another company, often to expand operations or enter new markets.

Additional Paid-in Capital

The amount received from investors for stock, over and above the stated par value of the shares.

Acquisition Transaction

An agreement in which one company purchases most or all of another company's shares to gain control of that company.

Fair Value

The asset's selling rate or the price required to manage a liability in a procedural transaction between participants in the market during the specified measurement interval.