Would you add or subtract treasury stock for SE on the balance sheet? Treasury stock is the shares the company buys back, correct, so wouldn't you subtract it? But then again, you can keep treasury stocks in the firms treasury, in case the firm needs some quick cash? Thanks.
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Treasury stock is a debit to Shareholders Equity - i.e., it reduces the SE balance.
You subtract it - Treasury Stock is a contra asset on the balance sheet and it reduces total Shareholder's equity. You are effectively removing those shares from the market / out of shareholders' hands
So, would you do something like this?
Beginning Treasury Stock – (Shares Repurchased * Share Price) = Ending Treasury Stock (then you add this amount to SE?)
?? But then, what would really be the beginning Treasury Stock amount? Would that just be stock that the company has saved up internally in their treasury dep't? Thanks.
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