Todd and Elaine purchased for $300,000 a building that was used for manufacturing pianos Then as promoters, they formed a new corporation and resold the building to the new corporation for $500,000 worth of stock After discovering the actual purchase price paid by the promoters, the other sharehold...

The other shareholders are entitled to have the 200000 of ...

Todd and Elaine purchased for $300,000 a building that was used for manufacturing pianos. Then as promoters,

Question:

Todd and Elaine purchased for $300,000 a building that was used for manufacturing pianos. Then as promoters, they formed a new and resold the building to the new for $500,000 worth of stock. After discovering the actual purchase price paid by the promoters, the other shareholders desire to have $200,000 of the canceled. Can they succeed in this action?

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...