Baden Corporation is a publicly held corporation whose shares, issued at $1 per share are actively traded at $20 per share. The company issued 1,000 shares to acquire land recently appraised at $15,000. When recording this transaction, Baden will
A) debit Land for $15,000.
B) credit Common Shares for $20,000.
C) debit Land for $20,000.
D) credit Gain on Purchase of Land for $5,000.

Question

Quizplus · Accepted Answer

The land should be recorded at its fair market value of $15,000, which is the appraised value.

Baden Corporation Is a Publicly Held Corporation Whose Shares, Issued