Treasury shares are most often reported as:
A)A reduction of total shareholders' equity.
B)A reduction of total paid-in capital.
C)A reduction to retained earnings.
D)An expense on the income statement.

Question

Quizplus · Accepted Answer

Treasury shares represent shares that a company has bought back from its shareholders, and are therefore considered a reduction of total shareholders' equity. In other words, treasury shares reduce the company's total outstanding shares, which affects the denominator of many financial ratios that use share counts, such as earnings per share (EPS) or price-to-earnings (P/E) ratio.

Treasury Shares Are Most Often Reported As