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    Cindy RSP's Avatar
    Cindy RSP Posts: 1, Reputation: 1
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    #1

    Feb 10, 2009, 12:18 PM
    Accounting for Redemption of stock?
    What is the proper accounting for the redemption of stock in a closely held C corporation? The redemption was done as a buyout of a shareholder.
    Cynthia514's Avatar
    Cynthia514 Posts: 37, Reputation: 1
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    #2

    Feb 10, 2009, 12:35 PM

    At the redemption of stock, (this means buy back the share from your shareholders and cancel them or keep them as treasure bill ) you have to re-calculate the average price per share to compare with the market price to see whether you have a gain or loss. The difference will be credited (gain) or debited (loss) to contribution surplus or retained earnings.
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