Table 14-6
Following Is the Shareholders' Equity Section of the Balance

question 64

Multiple Choice

Table 14-6
Following is the shareholders' equity section of the balance sheet of Thomson Corporation:
$$\begin{array} { | l | r | } \hline \text { Contributed capital } & \\\hline \text { Preferred shares, } \$ 6 \text {, cumulative, } 25,000 \text { shares } & \\\hline \text { authorized, } 7,000 \text { shares issued } & \$ 700,000 \\\hline \text { Common shares, } 1,000,000 \text { shares authorized, } 500,000 & \\\hline \text { shares issued } & 2,500,000 \\\hline \text { Total contributed capital } & 3,200,000 \\\hline \text { Retained earnings } & \$ 90,000 \\\hline \text { Total shareholders' equity } & \$ 4,190,000 \\\hline\end{array}$$ The preferred shares are currently selling for $89.50 per share and the common shares are currently selling for $12.50 per share.
-Refer to Table 14-6.Assuming Thomson purchases 10,000 of its common shares at $12.50 per share,total shareholders' equity is:

• A) increased $125,000
• B) decreased $125,000
• C) decreased $75,000
• D) the same as it was before the purchase of the company's own shares

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Definitions:

Gordon Allport

An influential psychologist recognized for his theory of personality that emphasized individuality and the positive aspects of human nature.

Recommendation

A suggestion or proposal given by someone based on their knowledge, experience, or understanding of a situation or product.

Source Traits

Fundamental personality characteristics that are considered inherent and stable over time, from which other traits arise.

Raymond Cattell

was a psychologist known for his work in personality theory, including the development of the 16 Personality Factor (16PF) questionnaire.