Stock repurchases may be used for all of the following EXCEPT
A) a means for providing an internal investment opportunity.
B) to improve earnings per share.
C) to decrease the corporation's debt ratio.
D) to eliminate a minority ownership group of stockholders.

Question

Quizplus · Accepted Answer

Stock repurchases are typically used to improve earnings per share and provide an internal investment opportunity. They can also be used to eliminate a minority ownership group of stockholders. However, stock repurchases do not directly impact a corporation's debt ratio. In fact, repurchasing stock may actually increase a corporation's debt ratio if it is funded through borrowed money.

Stock Repurchases May Be Used for All of the Following