By repurchasing shares of its own stock,a corporation liquidates some shareholders' claims,and total shareholders' equity decreases by the amount of the repurchase.

Question

Quizplus · Accepted Answer

When a corporation repurchases shares of its own stock, it reduces the number of outstanding shares, which in turn reduces the total shareholders' equity. Therefore, option A is true.

By Repurchasing Shares of Its Own Stock,a Corporation Liquidates Some