To record the purchase of treasury stock:

A) debit Treasury Stock-Common (par value) ; credit Cash (same) .
B) debit Treasury Stock-Common (purchase price) ; credit Cash (same) .
C) debit Treasury Stock-Common (par value) ; debit any difference to Paid-in Capital; credit Cash (purchase price) .
D) None of these answers is correct.

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Chase Orsak · Accepted Answer

Final Answer : B, Explanation :  When a company purchases its own stock as treasury stock, it records the transaction by debiting the Treasury Stock account for the purchase price and crediting Cash for the same amount. This reflects the reduction in cash and the increase in treasury stock on the balance sheet.

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