A corporation must recognize a gain on the sale of treasury stock for an amount greater than its purchase price.

Question

Quizplus · Accepted Answer

Treasury stock is a company's own stock that it has bought back from the market. When treasury stock is sold, the company recognizes a gain or loss on the sale. The gain or loss is the difference between the sale price and the purchase price of the treasury stock. If the sale price is greater than the purchase price, the company recognizes a gain on the sale.

A Corporation Must Recognize a Gain on the Sale of Treasury