How to Retire Treasury Shares

[@MyFinancialFocus]

Great explanation!

[@tarekalsherif57]

Thank you Michael, why specifically we debit the retained earnings?

[@martin_gonzalez_seoane]

I have the same doubt

[@joesums989]

@@martin_gonzalez_seoane I think its because we look at it as a payment. First the excess ((or profit made on par)) Then we dig into our own pockets (the business) to pay what is owed. SO first we give back our profits from the shares then we dig into the pockets if we have to? I think that is what is happening here

[@mahamsaleem3876]

Excess loss above APIC per share amount reduces RE directly

[@nilsrohrbacher6848]

What would happen with APIC and RE if we would retire them for a lower value, than initially issued for?

[@martin_gonzalez_seoane]

Same question

[@Edspira]

In that case, you would make a credit to the account, "Paid-in Capital - Treasury Shares"

[@CPAHallTalk]

Very well done!

[@salamance2]

What if the company sees a growth of APIC due to market reevaluation ? During the retirement of the 20,000 shares would that also be 100,000 debited APIC ?

[@peter9910]

Why don't treasury shares show up as an asset on the balance sheet? Thanks for the vid.

[@backstabber3537]

why would it its not an asset its a contra equity , u paid cash to purchase ur own shares " treasury stock " so no net asset was created

[@jinjung2042]

what is a contra equity account?

[@BlitzOfTheReich]

an account that reduces an equity account