the treasury stock account
Treasury Stock
true!
According to US GAAP, any gains in the sale of treasury stock cannot be recognized as income throught the income statement but must be run through paid in capital.
Answer:The purchase of treasury stock does not affect retained earnings. When the company owns treasury stock, then 'treasury stock' has a debit balance. It is nevertheless presented under equity, with a negative sign.(Technically, when a T-account switches from debit to credit - or the other way around - the sign flips.)Nevertheless, a subsequent sale of treasury stock can affect retained earnings when the amount received is below the cost (a loss is made). This loss is subtracted from retained earnings if there are no cumulative gains on prior sales of treasury stock.
Purchase of treasury stock has no effect on the net income of a business. The purchase may affect cash flow of the business. No profit or loss is claimed when shares are re-issued at above or below cost.
debit treasury stock 200000debit premium 40000credit cash 240000
37 cents until it was reissued for 41 cents.
Cost of sales = opening stock + purchases-closing stock Cost of sales = opening stock + purchases-closing stock
stock turnover rate is calculated as: =cost of good sold/average stock
Stock out cost is that cost which a company may earn if stock was not finished for example revenue could be earned by using that inventory stock or sales order may be lost due to non-availability of stock etc.
cost
Cost of sales