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Flashcards: Stock Issuance in Exchange for Property & Services
Acre, Boss, and Craft organized Plumb Corp. with authorized voting common stock of $100,000. Acre received 10% of the capital stock in payment for the organizational services she rendered for the benefit of the newly formed corporation. Acre did not contribute property to Plumb and was under no obligation to be paid by Boss or Craft. Boss and Craft transferred property in exchange for stock as follows:
What amount of gain did Acre recognize from this transaction?
$5,000
$0
$15,000
$10,000
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