When stock is issued in exchange for a noncash asset, the value recorded for the shares issued is best determined by
A)the book value of the noncash asset.
B)the market value of the shares.
C)the par value of the shares.
D)the contributed capital of the shares.

Question

Quizplus · Accepted Answer

The value recorded for the shares issued is best determined by the market value of the shares, as it reflects the fair value of the transaction at the time of exchange.

When Stock Is Issued in Exchange for a Noncash Asset