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.

Question

Quizplus · Accepted Answer

Under the cost method, the par value and the price at which the stock was originally issued are not important. Instead, the cost of the treasury stock is recorded on the balance sheet as a reduction in total equity.

Under the Cost Method, When Treasury Stock Is Purchased by the Corporation