The excess of cost over the sales price of treasury stock should be debited to loss from the Sale of Treasury Stock.
Formerly outstanding stock that has been repurchased and is now retained by the issuing business is known as treasury stock.
Treasury stock is a counter equity account since it lowers the overall shareholders' equity on a company's balance sheet.
The two ways for recording Treasury stock are the cost method and the par value approach.
Since the cost of the treasury is greater than the selling price of the stock.
This results in a loss on the sale of treasury stock.
Therefore, the loss is accounted for by debiting in accounting.
Hence, The excess of cost over the sales price of treasury stock should be debited to loss from the Sale of Treasury Stock.
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