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40. Porter Corp. purchased its own par value stock on
January 1, 2012 for $20,000 and debited the treasury stock
account for the purchase price. The stock was subsequently sold
for $12,000. The $8,000 difference between the cost and sales
price should be recorded as a deduction from

a. additional paid-in capital to the extent that previous net
"gains" from sales of the same class of stock are included
therein; otherwise, from retained earnings.

b. additional paid-in capital without regard as to whether or not
there have been previous net "gains" from sales of the same
class of stock included therein.

c. retained earnings.

d. net income.