A Company Acquires Land by Issuing 10,000 Shares of Its

question 64

Multiple Choice

A company acquires land by issuing 10,000 shares of its $10 par value common stock which is currently trading at $20 per share,and the appraised value of the land is $250,000.Which of the following statements correctly describes the recording of the land?

• A)Record the land at its appraised value of $250,000 and recognize a gain of $50,000 since the issued stock is currently worth $200,000.
• B)Record the land at the $200,000 value of the consideration given up.
• C)Record the land at the average of its appraised value of $250,000 and the $200,000 value of the stock issued,thereby recognizing a $25,000 gain.
• D)Record the land at the par value of the stock given up,$100,000.

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Definitions:

Labels Effective

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Organizational Socialization

The process through which new employees learn the values, norms, and expectations of an organization to become effective members.

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Organizational Culture

Refers to the set of shared values, beliefs, and norms that influence the way employees think, feel, and behave within an organization.