How Should a Corporation Account for the Repurchase of Its Own Stock Under U.S. GAAP?
The repurchase of stock, also known as a share buyback, is a common financial strategy employed by corporations. Under U.S. Generally Accepted Accounting Principles (GAAP), specific guidelines dictate how companies should account for such transactions. When a corporation repurchases its own shares, the accounting treatment must reflect the reduction in both equity and outstanding shares. […]