Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

12. Stockholders' Equity

Treasury Stock

Financial Accounting

12. Stockholders' Equity

Treasury Stock

Previous problemNext problem

Struggling with Financial Accounting?

Join thousands of students who trust us to help them ace their exams!Watch the first video

Multiple Choice

Shares of stock previously sold by the corporation that are repurchased are called:

Authorized stock

Outstanding stock

Preferred stock

Treasury stock

Previous problemNext problem

Verified step by step guidance

Understand the concept of Treasury Stock: Treasury stock refers to shares that were previously issued and sold by a corporation but have been repurchased by the corporation itself. These shares are not considered outstanding and do not have voting rights or receive dividends.

Differentiate between the other options: Authorized stock refers to the maximum number of shares a corporation is legally allowed to issue, as specified in its charter. Outstanding stock refers to shares currently held by shareholders, excluding treasury stock. Preferred stock is a type of stock that typically has priority over common stock in dividend payments and liquidation rights.

Recognize the key characteristic of Treasury Stock: Treasury stock is unique because it represents shares that are held by the corporation itself after repurchase, and it reduces the number of outstanding shares.

Apply the definition to the problem: Since the question asks for the term describing shares repurchased by the corporation, the correct answer is Treasury Stock, as it matches the definition provided.

Reinforce the learning: Remember that Treasury Stock is recorded as a contra-equity account on the balance sheet, reducing total equity, and it does not contribute to the calculation of earnings per share or dividends.