treasury stock method

Definition

Accounting method that factors in the potential value of new shares that will be acquired when remaining options and warrants are exercised. This figure is computed by taking the number of in the money shares and subtracting them from the number of shares that can be repurchased. The resulting figure is then included in the company's diluted earnings per share.

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You may want to try and use the treasury stock method if you think that may make things easier for you.

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When the SEC accountants audited ABC Corp's books, they discovered the company devised a new method for using the treasury stock method to mislead and defraud investors.

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