When a Company Sells Its Stock for an Asset Other

question 34

True/False

When a company sells its stock for an asset other than cash, the asset's prior book value is used to record the value of the stock.

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Definitions:

Charitable Organization

A nonprofit entity that operates to provide relief to the poor, advance education, or undertake other activities serving the public interest.

Partnership

A business organization in which two or more individuals manage and operate the business in accordance with the terms and objectives set out in a Partnership Agreement.

Limited Liability Companies

A business structure that combines the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation.

Distributions

The payment of dividends or other assets to a company's shareholders as determined by the board of directors.