When Treasury Stock Is Sold Above or Below Cost, Why

question 109

Essay

When treasury stock is sold above or below cost, why isn't this reported on the income statement as a gain or loss?

Identify which costs are included in the cost of products manufactured under the absorption costing concept.

Distinguish between variable and absorption costing in the treatment of fixed and variable costs.

Recognize how variable and absorption costing impact the income statement presentation, specifically gross profit, contribution margin, and net profit.

Understand the application of variable and absorption costing in determining the cost of goods sold.

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