When stock is issued for assets other than cash,the transaction is recorded at the market value of the stock issued or the market value of the assets received,whichever is more clearly determinable.

Question

Quizplus · Accepted Answer

This statement is true. According to generally accepted accounting principles (GAAP), when stock is issued in exchange for non-cash assets, the transaction should be recorded at the fair market value of either the stock issued or the assets received, whichever is more clearly determinable. This is based on the concept of "fair value accounting," which requires companies to report the estimated value of their assets and liabilities based on current market conditions.

When Stock Is Issued for Assets Other Than Cash,the Transaction