ACC 304 All Assignments ACC 304 All Assignments | Page 48

d. net income.
41. How should a "gain" from the sale of treasury stock be reflected
when using the cost method of recording treasury stock transactions?
a. As ordinary earnings shown on the income statement.
b. As paid-in capital from treasury stock transactions.
c. As an increase in the amount shown for common stock.
d. As an extraordinary item shown on the income statement.
42. Which of the following best describes a possible result of
treasury stock transactions by a corporation?
a. May increase but not decrease retained earnings.