Osbourne Company issued 50,000 shares of common stock in exchange for manufacturing equipment. The equipment was valued at $1,000,000. The stock has par value of $0.01 per share. Osbourne should record a gain on the sale of stock for the difference between the equipment's market value and the stock's current market value.

Question

Quizplus · Accepted Answer

The transaction involves issuing stock, not selling it, so there is no gain or loss to be recorded. Additionally, the question does not provide information about the current market value of the stock, so it cannot be used to calculate any potential gain or loss.

Osbourne Company Issued 50,000 Shares of Common Stock in Exchange