During 2014, Thomas Corporation repurchased some shares of its own common stock. What effect did this transaction have on 2014 stockholders' equity and earnings per share, respectively? $\begin{array}{lll}&\underline{\text { Stockholders' Equity }}&\underline{\text { Earnings Per Share }}\
\text { A. } & \text { Decrease } & \text { No effect } \
\text { B. } & \text { Increase } & \text { No effect } \
\text { C. } & \text { Decrease } & \text { Decrease } \
\text { D. } & \text { Decrease } & \text { Increase }
\end{array}$
A) Option A
B) Option B
C)Option C
D)Option D

Question

Quizplus · Accepted Answer

Repurchasing shares decreases stockholders' equity because it reduces the number of outstanding shares, which increases earnings per share as the same earnings are distributed over fewer shares.

During 2014, Thomas Corporation Repurchased Some Shares of Its Own