When Treasury Stock Is Reissued at a Price Above Cost

question 87

Multiple Choice

When treasury stock is reissued at a price above cost:

• A)The corporation recognizes a gain to be recorded on the income statement.
• B)Total paid-in capital is increased.
• C)The re-issuance is treated as an extraordinary item in the corporation's income statement.
• D)Retained earnings is increased.

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Definitions:

British America

Territories in North and South America that were once part of the British Empire, including the original Thirteen Colonies that became the United States.

New World

The New World refers to the continents of North and South America, which were "discovered" and subsequently colonized by Europeans from the 15th century onwards, contrasting with the Old World of Europe, Asia, and Africa.

Indians

A term historically used to refer to Native Americans, though less preferred today due to its origin with Christopher Columbus mistakenly identifying the Americas as India.

Navigation Act

Law passed by the English Parliament to control colonial trade and bolster the mercantile system, 1650–1775; enforcement of the act led to growing resentment by colonists.