Which Type of Stock Repurchase Allows Management to Set the Repurchase

question 16

Multiple Choice

Which type of stock repurchase allows management to set the repurchase price at the lowest level necessary to repurchase the desired number of shares?

• A) Open-market repurchase
• B) Fixed-price tender offer repurchase
• C) Dutch auction tender offer repurchase
• D) All of the above will generate the same purchase price.

---

Definitions:

Inventory Costing Methods

Strategies used by companies to assign costs to inventory and to determine the cost of goods sold, including FIFO (First In, First Out), LIFO (Last In, First Out), and weighted average cost.

LIFO Method

An inventory valuation method that assumes the last items of inventory purchased are the first ones sold, potentially minimizing taxes in an inflationary period.

Purchase Order

A formal document issued by a buyer to a seller, detailing the products or services ordered and the agreed-upon price.

Periodic Inventory System

A system in which inventory levels are updated in the accounting records on a periodic basis, typically at the end of an accounting period.