In January 2014, ABC Corporation, a new corporation, issued 10,000 shares of common stock with a par value of $10 for $15 per share. On July 1, 2014, ABC Corporation repurchased 1,000 shares of stock that were outstanding for $12 per share. This repurchase transaction has the effect of: a. it does not affect the total shareholders' equity. b. reduce the total equity of the shareholders. c. decrease the number of shares issued.
In January 2014, ABC Corporation, a new corporation, issued 10,000 shares of common stock with a par value of $10 for $15 per share. On July 1, 2014, ABC Corporation repurchased 1,000 shares of stock that were outstanding for $12 per share. This repurchase transaction has the effect of: a. it does not affect the total shareholders' equity. b. reduce the total equity of the shareholders. c. decrease the number of shares issued.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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In January 2014, ABC Corporation, a new corporation, issued 10,000 shares of common stock with a par value of $10 for $15 per share. On July 1, 2014, ABC Corporation repurchased 1,000 shares of stock that were outstanding for $12 per share. This repurchase transaction has the effect of:
a. it does not affect the total shareholders' equity.
b. reduce the total equity of the shareholders.
c. decrease the number of shares issued.
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