how is treasury stock shown on the balance sheet? a.as an asset b.treasury stock is not shown on the balance sheet. c.as a decrease in stockholders' equity d.as an increase in stockholders' equity

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04-11-2022
Business

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how is treasury stock shown on the balance sheet? a.as an asset b.treasury stock is not shown on the balance sheet. c.as a decrease in stockholders' equity d.as an increase in stockholders' equity

Sagot :

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Tundexi Tundexi · Answer 1 · 2022-11-08T06:43:58-05:00

On the balance sheet, as the treasury stock is listed under the shareholders' equity as a negative number, then, it is shown as as a decrease in stockholders' equity.

What is a treasury stock?

Basically, a treasury stock refers to the shares in a company that the issuer has reacquired; the issuing company can however retire the stock or resell it at a later date.

When we are calculating the number of shares that is issued and outstanding which are reported in a company's financial statements,the treasury stock is classified as issued but it is not outstanding. The amount paid to buy back treasury stock is recorded in a contra equity account that appears in the equity section of the balance sheet. Therefore, the Option C is correct.

Sagot :

What is a treasury stock?

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