On February 22, 2022 Lightning Corporation purchased 500 shares of its own common stock for $10,000. Prior to this transaction, Lightning had 200,000 shares of its $5 par common stock issued and outstanding. The corporation has had no prior treasury stock transactions, consequently, the company president must decide if the cost or par value method will be used.

Explain the differences in the financial statements if the cost method of accounting for treasury stock is used instead of the par value method.