Answered: Under the cost method, when treasury…

Under the cost method, when treasury stock is purchased by the corporation, the par value and the price at which the stock was originally issued are important. True false

Century 21 Accounting Multicolumn Journal

11th Edition

ISBN:9781337679503

Author:Gilbertson

Publisher:Gilbertson

Chapter16: Financial Statements And Closing Entries For A Corporation

Section16.2: Preparing A Statement Of Stockholders’ Equity

Problem 5AYU

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Question

Under the cost method, when treasury stock is purchased by the corporation, the par value and the price at which the stock was originally issued are important.
1. True
2. false

Definition Definition Stock repurchased from the stockholders by the company that once issued it. The repurchase of the stock reduces the stockholder's equity balance on the balance sheet. Treasury stocks are an important constituent of stockholder's equity but do not carry any voting rights.

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