Treasury Stock Method
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Definition of 'Treasury Stock Method'
The treasury stock method is a way of accounting for the purchase and sale of a company's own stock. When a company buys back its own stock, it is called treasury stock. The treasury stock method is used to account for the difference between the purchase price of the treasury stock and the original issuance price.
The treasury stock method is used to calculate the following:
* The number of shares outstanding
* The earnings per share
* The book value per share
The treasury stock method is used to calculate the number of shares outstanding by subtracting the number of treasury shares from the total number of shares issued. The earnings per share is calculated by dividing the net income by the number of shares outstanding. The book value per share is calculated by dividing the total stockholders' equity by the number of shares outstanding.
The treasury stock method is used to account for the difference between the purchase price of the treasury stock and the original issuance price. The difference is called the "treasury stock adjustment." The treasury stock adjustment is added to or subtracted from the retained earnings balance.
The treasury stock method is used to account for the purchase and sale of a company's own stock. It is a way of accounting for the difference between the purchase price of the treasury stock and the original issuance price. The treasury stock method is used to calculate the number of shares outstanding, the earnings per share, and the book value per share.
The treasury stock method is used to calculate the following:
* The number of shares outstanding
* The earnings per share
* The book value per share
The treasury stock method is used to calculate the number of shares outstanding by subtracting the number of treasury shares from the total number of shares issued. The earnings per share is calculated by dividing the net income by the number of shares outstanding. The book value per share is calculated by dividing the total stockholders' equity by the number of shares outstanding.
The treasury stock method is used to account for the difference between the purchase price of the treasury stock and the original issuance price. The difference is called the "treasury stock adjustment." The treasury stock adjustment is added to or subtracted from the retained earnings balance.
The treasury stock method is used to account for the purchase and sale of a company's own stock. It is a way of accounting for the difference between the purchase price of the treasury stock and the original issuance price. The treasury stock method is used to calculate the number of shares outstanding, the earnings per share, and the book value per share.
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