Respuesta :
Answer: $2,000,000
Explanation:
Treasury stock is simply a stock that is bought back by a company while retained earnings are cumulative profit that a company makes after dividends has been paid out.
From the question, gain per share will be: $51 - $50 = $1
Therefore, there will be increase in retained earnings by $1 million.
The deficit per share will be:
= $47 - $50 = $-3
The amount that is declined in the retained earnings will now be:
= $-3 × 1,000,000
= $-3 million
The amount by which retained earnings will decline will be:
= $3,000,000 - $1,000,000
= $2,000,000
