A is corrent. Generally, noncurrent assets acquired in a noncash transaction should be recorded at fair value of the consideration given (common stock), unless fair value of the asset acquired (patent) is more clearly determinable. Fair value of the stock given is therefore the correct value to assign to the patent received (2,000 shares x $40 per share = $80,000).
B is incorrect. Generally, noncurrent assets acquired in a noncash transaction should be recorded at fair value of the consideration given (common stock), unless fair value of the asset acquired (patent) is more clearly determinable. Fair value of the stock given is therefore the correct value to assign to the patent received (2,000 shares x $40 per share = $80,000).
B is incorrect. Generally, noncurrent assets acquired in a noncash transaction should be recorded at fair value of the consideration given (common stock), unless fair value of the asset acquired (patent) is more clearly determinable. Fair value of the stock given is therefore the correct value to assign to the patent received (2,000 shares x $40 per share = $80,000).
D is incorrect. Generally, noncurrent assets acquired in a noncash transaction should be recorded at fair value of the consideration given (common stock), unless fair value of the asset acquired (patent) is more clearly determinable. Fair value of the stock given is therefore the correct value to assign to the patent received (2,000 shares x $40 per share = $80,000).
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