Question

Select a company on the New York Stock Exchange (U.S. only). Review Financial Statements in the Annual Report within the last three years. For one year, briefly summarize the effect of Treasury Stock transactions on the Balance Sheet

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Treasury stock is the owned by the company that was sold and eventually reacquired. Any gains in selling treasury stock are considered in financial reports as addition to contribution capital and loss as deduction from any previous capital contributed. Treasury stock is deductible position from stockholder’s equity. There are couple reasons why companies purchase its own stock. First one is when management feels that the stock price is too low. Second reason would be to use them in acquisition of other companies. Third is to increase earnings per share amounts....

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