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16 April, 22:44

When stock is issued for assets other than cash, the transaction is always recorded at the market value of the stock issued?

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  1. 16 April, 22:51
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    The answer is true. The measurement objective is that the transaction should be measured and recorded at fair market value. This might be the fair market value of the issued shares or of the non-cash asset received in the exchange. The value that should be used is the one that is more clearly evident. This is consistent with the general practice of recording any non-cash transaction at market value. When the stock is actively traded on an organized stock exchange, the market value of the stock might be the best evidence.
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