Issuing Common and Preferred Stock Generally Has Been Popular Among

question 160

Essay

Issuing common and preferred stock generally has been popular among corporations.However,some companies have bought back their common stock.For what reasons would a company buy back its own shares?

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Definitions:

Straight-Line Method

A method of calculating depreciation of an asset where the asset's cost is reduced equally over its useful life.

Amortize Discount

The process of gradually reducing the discount on a bond over the life of the bond.

Bonds Payable

Bonds payable refers to the long-term debt a company owes to bondholders, representing the amount that is due to be paid back at the bond's maturity date along with periodic interest payments.

Straight-Line Method

A depreciation method that allocates an equal amount of the asset's cost to each accounting period of its useful life.