Oxfam Telephone Company Case Study Essay
Clyde would not have more discretion in the recording of his bartering exchange. First of all, he could not make up his fair value. There are certain rules that you must follow with FASB. The fair value is consisting of measurements and how accurate it is. According to paragraph 505-50-30-02, “Paragraph 505-50-30-6 establishes that share-based payment transactions with nonemployees shall be measured at the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable.” When Clyde acquired a land from issuing his stocks, the fair market of the land had set the value of the transaction. When Clyde bartered his stocks for land and equipment, then there was a mutual benefit
…show more content…
Paragraph 05-10 said, “The barter credits can be used to purchase goods or services, such as advertising time, from either the barter entity or members of its barter exchange network.” It is useful to barter because you don’t have to give cash up …show more content…
In contrast, if the fair value of the equity instruments issued in a share-based payment transaction with nonemployees is more reliably measurable than the fair value of the consideration received, the transaction shall be measured based on the fair value of the equity instruments issued.” Therefore, the more reliable measurement should be recorded under assets. Also, according to the IFRS “An entity shall recognize the goods acquired or services received in a share-based payment transaction when it obtains the goods or as services are received.” Furthermore, once Clyde receives the goods or services, he would have to be recognized once it was received. Barter dollars and money are identical to each other when it comes to tax reporting. You have to report the fair market value of the goods once it was received. It is also required to file 1099-B. As well, Clyde does not have more discretion in the recording of his bartering exchange. Treasury stock or newly issued stock could both be use without causing an effect. The same rules apply for both of
Paragraph 05-10 said, “The barter credits can be used to purchase goods or services, such as advertising time, from either the barter entity or members of its barter exchange network.” It is useful to barter because you don’t have to give cash up …show more content…
In contrast, if the fair value of the equity instruments issued in a share-based payment transaction with nonemployees is more reliably measurable than the fair value of the consideration received, the transaction shall be measured based on the fair value of the equity instruments issued.” Therefore, the more reliable measurement should be recorded under assets. Also, according to the IFRS “An entity shall recognize the goods acquired or services received in a share-based payment transaction when it obtains the goods or as services are received.” Furthermore, once Clyde receives the goods or services, he would have to be recognized once it was received. Barter dollars and money are identical to each other when it comes to tax reporting. You have to report the fair market value of the goods once it was received. It is also required to file 1099-B. As well, Clyde does not have more discretion in the recording of his bartering exchange. Treasury stock or newly issued stock could both be use without causing an effect. The same rules apply for both of