When Common Stock Is Issued for Services or Non-Cash Assets

question 167

Multiple Choice

When common stock is issued for services or non-cash assets cost should be

• A) only the fair value of the consideration given up.
• B) only the fair value of the consideration received.
• C) the book value of the common stock issued.
• D) either the fair value of the consideration given up or the consideration received whichever is more clearly evident.

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Definitions:

Improved Compensation

An enhancement in the salary, wages, and benefits that employees receive in exchange for their work.

Incentives

Rewards or benefits offered to encourage a specific action or behavior.

Group Norms

Unwritten rules and expectations about how group members should behave, which influence the behavior of individuals within the group.

Resistance To Change

The act of opposing or struggling against modifications or transformations within an organization or in personal behavior.