True regarding distributions as repurchases of stock

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Reference no: EM131942783

1. The price of a stock prior to a repurchase is $50.0. iI the number of outstanding shares prior to a repurchase is 100,000 shares, how many were repurchased using $200,000 cash?

a. 2,000

b. 96,000

c. 4,000

d. 6,000

2. Which of the following is true regarding distributions as repurchases of stock:

a. retained earnings are reduced by the amount of the repurchased amoutn

b. stock price is reduced due to the stock repurchase

c. stock price does not change due to the stock repurchase

d. net income is reduced by the repurchased amount

Reference no: EM131942783

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