Jewel Manufacturing uses the cost method to account for treasury stock. After a recent treasury stock transaction, the firm recorded a $200,000 debit to Treasury Stock and a $200,000 credit to Cash. These entries suggest that Jewel

Multiple choice

spent $200,000 to acquire shares of treasury stock.

sold $200,000 of treasury stock that it had purchased earlier in the year for $400,000.

made $200,000 from the sale of existing treasury stock.

has outstanding stock worth $200,000 and treasury stock worth $200,000.