A company might purchase treasury stock for all of the following reasons excepta. it wants to increase its net assets by buying its stock low and reselling it at a higher price.b. management wants to decrease the earnings per share of common stock.c. management wants to avoid a takeover by an outside party.d. the company needs the stock to distribute to employees as part of its employee stockpurchase plans.
A company might purchase treasury stock for all of the following reasons excepta. it wants to increase its net assets by buying its stock low and reselling it at a higher price.b. management wants to decrease the earnings per share of common stock.c. management wants to avoid a takeover by an outside party.d. the company needs the stock to distribute to employees as part of its employee stockpurchase plans.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A company might purchase
a. it wants to increase its net assets by buying its stock low and reselling it at a higher price.
b. management wants to decrease the earnings per share of common stock.
c. management wants to avoid a takeover by an outside party.
d. the company needs the stock to distribute to employees as part of its employee stock
purchase plans.
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