Question

When treasury stock is resold for more than it was purchased, the difference between its cost and the cash received when resold:

Answer 1

Answer:

D. Increases stockholders' equity.

Explanation:

In the case when the treasury stock is resold for high amount that was buy so the difference occurs between the cost and the cash collected once it is resold should increase the stockholder equity

As when the treasury stock is sold, the journal entry is

Cash  

       To Treasury stock(cost value)

      To Paid in capital from treasury stock

(being the treasury stock is sold)

So, It doesn't impact the income statement as it is shown in the stockholder equity