A corporation has 30,000 issued shares and 3,000 shares in treasury stock. How does treasury stock affect the calculation of outstanding shares?

• A. Treasury stock has no effect on the number of outstanding shares.
• B. Treasury stock is included in the calculation of issued shares but not outstanding shares.
• C. Treasury stock increases the number of outstanding shares by the number of shares repurchased.
• D. Treasury stock reduces the number of outstanding shares by the number of shares repurchased.

Answer: (D)