Corporate Finance question from Schweser pro, statements, following, question, decrease

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On the Selftest: Corporate Finance:
An analyst is constructing pro forma financial statements for Liden Plastics Corp that are based on an expected 8% increase in sales next year. His first iteration results in a financial surplus of $2.2million. Which of the following assumptions would result in no financial surplus or deficiency in the next iteration of the pro forma statements?
A) The surplus will be used to decrease Liden’s outstanding longterm debt
B) Liden will use the surplus to repurchase its common stock
C) The surplus will be used to repurchase Liden’s common shares and reture longterm debt in amounts that preserve Liden’s existing capital structure
I answered (A), the correct answer is (B)
In a similar case in SS11 reading #47 (pgs 8081), it shows an example of an assumption made to reconcile a surplus in the pro forma statements by decreasing longterm debt. However, it states that successive iterations will result in a zero surplus. So, I guess the repurchasing of stock will fix the entire surplus by the next iteration..whereas using the surplus to decrease debt requires several iterations? I don’t fully understand Schweser’s explanation either. Also, I don’t think the SchweserNotes covered using a surplus to repurchase stock. Guess its a matter of doing EVERY question possible.