Question

Treasury shares are most often reported as:

-A reduction of total shareholders' equity
-A reduction of total paid-in capital
-A reduction of retained earnings
-An expense in the income statement

Answer 1

Answer:

A reduction of total shareholders' equity

Explanation:

Treasury shares/ treasury stocks is reacquired stock or bought back by the issuing company; which then reduce the outstanding of common shares.

The repurchase brings the total shareholder's equity down to the amount paid for treasury shares.