If a company resells treasury stock below the acquisition cost, a loss from the sale of treasury stock is recorded.

Question

Quizplus · Accepted Answer

When a company resells treasury stock below the acquisition cost, it does not record a loss. Instead, the difference is typically charged against additional paid-in capital or retained earnings, as treasury stock transactions are considered equity transactions, not income statement transactions.

If a Company Resells Treasury Stock Below the Acquisition Cost