Treasury stock should be reported in the financial statements of a corporation as a(n)
A) investment.
B) liability.
C) current asset.
D) deduction from stockholders's equity.

Question

Quizplus · Accepted Answer

Treasury stock is shares of a company's own stock that have been repurchased from shareholders. Therefore, treasury stock is deducted from stockholders' equity as it represents a reduction of the amount of shareholder's investment in the company. Treasury stock is not an investment, liability, or a current asset.

Treasury Stock Should Be Reported in the Financial Statements of a Corporation