EXERCISE 15-3 - prior, unrelated event. The appraised value...

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EXERCISE 15-3 (10–15 minutes) (a) Land ($60 X 25,000). ......................................................... 1,500,000 Treasury Stock ($48 X 25,000). ............................ 1,200,000 Paid-in Capital from Treasury Stock . ................ 300,000 (b) One might use the cost of treasury stock. However, this is not a relevant measure of this economic event. Rather, it is a measure of a
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Unformatted text preview: prior, unrelated event. The appraised value of the land is a reasonable alternative (if based on appropriate fair value estimation techniques). However, it is an appraisal as opposed to a market-determined price. The trading price of the stock is probably the best measure of fair value in this transaction....
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This note was uploaded on 01/31/2011 for the course ACCT 302 taught by Professor Leee during the Winter '10 term at Grand Rapids Community College.

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