Treasury stock is reported within the balance sheet as

Question

Quizplus · Accepted Answer

Treasury stock is considered as a contra account to owners' equity as it represents a reduction in the total amount of equity available to the shareholders. Therefore, it is reported within the shareholders' equity section of the balance sheet. Option A and B are not correct as treasury stock is not considered as an investment in other companies. Option C is close but not entirely accurate as retained earnings represent the net income earned by the company that is not distributed to the shareholders as dividends.

Treasury Stock Is Reported Within the Balance Sheet as