Joe Dumars Company has outstanding 40,000 shares of $5 par common stock which had been issued at $30 per share. Joe Dumars then entered into the following transactions.

1.		Purchased 5,000 treasury shares at $45 per share.
2.		Resold 2,000 of the treasury shares at $49 per share.
3.		Resold 500 of the treasury shares at $40 per share.

Indicate the effect each of the three transactions has on the financial statement categories listed in the table below, assuming Joe Dumars Company uses the cost method.

#		Assets		Liabilities		Stockholders Equity		Paid-in Capital		Retained Earnings		Net Income
1.		select an effect on a financial statement category IncreaseDecreaseNo effect		select an effect on a financial statement category No effectDecreaseIncrease		select an effect on a financial statement category No effectIncreaseDecrease		select an effect on a financial statement category DecreaseNo effectIncrease		select an effect on a financial statement category No effectIncreaseDecrease		select an effect on a financial statement category DecreaseNo effectIncrease
2.		select an effect on a financial statement category IncreaseNo effectDecrease		select an effect on a financial statement category IncreaseNo effectDecrease		select an effect on a financial statement category IncreaseNo effectDecrease		select an effect on a financial statement category DecreaseIncreaseNo effect		select an effect on a financial statement category No effectIncreaseDecrease		select an effect on a financial statement category DecreaseIncreaseNo effect
3.		select an effect on a financial statement category IncreaseNo effectDecrease		select an effect on a financial statement category DecreaseIncreaseNo effect		select an effect on a financial statement category DecreaseNo effectIncrease		select an effect on a financial statement category IncreaseDecreaseNo effect		select an effect on a financial statement category DecreaseNo effectIncrease		select an effect on a financial statement category No effectIncreaseDecrease