Question

Merritt company acquired a building valued at $210,000 for property tax purposes in exchange for 12,000 shares of its $5 par common stock. the stock is widely traded and selling for $18 per share. at what amount should the building be recorded by merritt company

Answer 1

The solution would be like this for this specific problem:

12,000 * $18
= $216,000

So the amount that the building should be recorded by the Merritt Company is $216,000. I hope this helps and if you have any further questions, please don’t hesitate to ask again.