D is corrent because only the common stock outstanding will be decreased by the amount of treasury stock purchased. When a company reacquires its own stock, the purchase does not reduce the number of shares issued or authorized, but does reduce the number of shares outstanding and the total stockholders’ equity.
A is incorrect because once stock has been issued, the total common stock issued is decreased only when it is repurchased and retired.
B is incorrect because treasury stock is stock that has already been authorized and issued, and, even if repurchased, the stock is still authorized.
C is incorrect because the purchase of treasury stock does have an effect on the amount of common stock outstanding.
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