Standard Corp

question 193

Multiple Choice

Standard Corp.repurchased 1,000 shares of its $1 par value common stock on the market when it was trading for $16 per share.How would the company record this transaction?

• A)Debit Treasury Stock for $1,000 and credit Cash for $1,000.
• B)Debit Treasury Stock,Common for $1,000 and credit Cash for $1,000.
• C)Debit Treasury Stock,$1 Par Value for $16,000 and credit 16 for $16,000.
• D)Debit Treasury Stock,Common for $16,000 and credit Cash for $16,000.
• E)Debit Retained Earnings for $16,000 and credit Treasury Stock,Common for $16,000.

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Definitions:

Variable Selling Expenses

Selling expenses that fluctuate with sales volume, such as commissions and shipping fees.

Contribution Margin

The amount by which a product's selling price exceeds its total variable cost, indicating how much contributes to covering fixed costs and generating profit.

Variable Selling Expense

Costs that vary directly with the volume of sales, such as commissions or shipping fees.

Fixed Selling Expense

Expenses that remain constant regardless of the volume of goods or services sold, such as salaries and rent for the sales department.