Final answer:
The land acquired by A-Team Corporation in exchange for 1,000 shares of stock should be recorded at the fair value of the stock, which is $9 per share, resulting in a total value of A) $9,000. This is because the fair value is more clearly determinable based on the active trading price of the stock.
Step-by-step explanation:
The question centers around the appropriate accounting treatment for a non-cash transaction where A-Team Corporation issued shares of stock in exchange for land. Specifically, it involves determining the correct value at which to record the land on the company's balance sheet when the par value of the issued stock, the trading price of the stock, and the advertised sale price of the land all differ.
To answer this, we apply an accounting principle whereby assets acquired in exchange for company stock should be recorded at the fair value of the asset given up or the fair value of the asset received, whichever is more clearly determinable. In this case, the stock has a known fair value based on its active trading price. The 1,000 shares issued are trading at $9 per share, thereby giving us a fair value of $9,000 (1,000 shares x $9). The land's advertised price of $10,500 is less relevant as it is not necessarily a reflection of the land's fair value. Therefore, the land should be recorded at the value of the stock issued in exchange for it, which is $9,000.