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Financial Accounting

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Shareholders' Equity: Treasury Stock Shares

FINACT-UR9NKA

Orange Company was incorporated on January 1, 2016. The corporate charter authorized 40,000 shares of no par value common stock. Orange Company issued 17,500 of these shares to each of its shareholders (John and Jane Doe) on January 23, 2016 in exchange for \$10,000 cash from each of them. On December 15, 2016, Orange Company repurchased some shares from Jane for \$3,000. No other transactions relative to common stock took place in 2016 other than the transactions listed above.

If there are 28,000 shares outstanding at December 31, 2016, how many shares of treasury stock did the company buy from Jane on December 15, 2016?

A

35,000 shares

B

40,000 shares

C

7,000 shares

D

28,000 shares