Discuss how stock is valued when issued in exchange for noncash consideration
What will be an ideal response?
Answer: When common stock is issued in exchange for noncash assets or services, the stock will be recorded using the fair value of the stock, or the fair value of the asset or service, whichever is most objectively ascertainable. When it is more challenging to come up with a fair value, management will need to exercise judgment when determining an appropriate fair value amount.
You might also like to view...
Which of the following is considered a constructive delivery of a gift?
A) giving the key to a safe-deposit box where the gift is kept B) paying for the total value of the good being gifted in cash C) contracting a third party to deliver goods to the donee D) gifting someone in person to ensure acceptance of the gift
Which of the following communicate company values and culture?
A) Performance appraisals B) Budgets C) New plans D) all of the above