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Luz, Inc. purchases 1,000 shares of its own previously issued OMR 5 par value ordinary shares...

Luz, Inc. purchases 1,000 shares of its own previously issued OMR 5 par value ordinary shares for OMR 9,000. On a later date, the purchased treasury shares are resold by Luz Inc., for OMR 13,000.  
What do the above transactions affect net income, total assets, retained earnings, and total equity, and show overall net effect amount?

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Answer #1
Effect on net income Effect on total assets Effect on retained earnings Effect on total equity
Purchase of treasury stock for 9,000 No effect Decrease by 9,000 No effect Decrease by 9,000
Sales of treasury stock for 13,000 No effect Increase by 13,000 No effect Increase by 13,000
Overall net effect No effect Increase by 4,000 No effect Increase by 4,000

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