In 2007, Winn, Inc

question 46

Multiple Choice

In 2007, Winn, Inc. issued $1 par value common stock for $35 per share. No other common stock transactions occurred until July 31, 2009, when Winn acquired some of the issued shares for $30 per share and retired them. Which of the following statements correctly states an effect of this acquisition and retirement?

• A)2009 net income is decreased.
• B)Additional paid-in capital is decreased.
• C)2009 net income is increased.
• D)Retained earnings is increased.The entries to record the stock issuance and subsequent acquisition and retirement (per share) are as follows:
• The net result is a decrease in additional paid-in capital of $29 per share retired.

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