Mini Corp acquired a patent from Maxi Co. in exchange for 2,500 shares of its common stock worth $9 per share, totaling $22,500, and $95,000 in cash. The total value Mini Corp should record the patent at is $117,500, the historical value of the shares when the patent was acquired plus the cash paid.

1. Mini Corp. acquires a patent from Maxi Co. in exchange for 2,500 shares of Mini Corp.'s $5 par
value common stock and $95,000 cash. When the patent was initially issued to Maxi Co., Mini
Corp.'s stock was selling at $7.50 per share. When Mini Corp. acquired the patent, its stock was
selling for $9 a share. Mini Corp. should record the patent at what amount?
$117,500
$95,000
$107,500
$113,750
$117,500
Solution
Patent Amount Recorded = Historical value of shares(when the patent was acquired by Mini
Corp.) + Cash received
= 2500*$9+ $95000
= $22500+ $95000
= $117,500