SIE practice questionmediumTreasury Stock
What happens to a company’s outstanding shares when it repurchases and holds treasury stock?
- AOutstanding shares decrease✓ Correct answer
- BShares are reissued automatically
- CNo impact on outstanding shares
- DOutstanding shares increase
Explanation
Why A — Outstanding shares decrease
Treasury shares are not counted as outstanding; repurchasing reduces the outstanding total. They do not reissue automatically, nor does it increase totals.
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