Author Question: In entering in the books an invoice that involves a trade discount, the amount to be used is the net ... (Read 136 times)

roselinechinyere27m · **on:** Jul 5, 2018

In entering in the books an invoice that involves a trade discount, the amount to be used is the net amount after the trade discount is subtracted.
a. True
b. False
Indicate whether the statement is true or false

Question 2

Anika Braun, owner and CEO of Braun's Sports Den, believes that the corporation has too many shares outstanding. She is worried that a Japanese company will buy the shares and take over the business.

Her accountant has suggested that Braun's Sports Den buy treasury stock. Explain to Anika why buying treasury stock may be an option.
What will be an ideal response?

katkat_flores · **Reply #1 on:** Jul 5, 2018

Answer to Question 1

True

Answer to Question 2

Treasury stock is stock of a corporation that has been issued and then repurchased by the corporation. Braun's Sports Den can buy back shares of its stock on the stock market. This reduces the number of shares available for competitors to buy. Treasury stock can then be reissued to existing shareholders on a percentage of ownership basis, or given to employees as part of a profit-sharing package.