When a company wishes to purchase and retire its own stock,the company must
A)decrease the Stock account balances by the original issue price.
B)record a gain or loss depending on the difference between the original selling price and the repurchase cost.
C)get the approval of the state to do so.
D)issue a different class of stock to the former stockholders.

Question

Quizplus · Accepted Answer

When a company repurchases its own stock, it decreases the Stock account balances by the original issue price, as the shares are being retired and removed from circulation.

When a Company Wishes to Purchase and Retire Its Own