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substantially more risky than Eagle's current business. Eagle transferred the following assets and accounts payable to...

substantially more risky than Eagle's current business. Eagle transferred the following assets and accounts payable to Sand Corporation in exchange for 5,000 shares of $10 par value stock of Sand: Cost Book Value Cash $ 30,000 $ 30,000 Accounts Receivable 45,000 40,000 Inventory 60,000 60,000 Land 20,000 20,000 Buildings & Equipment 300,000 260,000 Accounts Payable 10,000 10,000 Required: a. Prepare the journal entry that Eagle recorded for the transfer of assets and accounts payable to Sand. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Show work and how you came to the different numbers ex : investment in common stock

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Expert Solution

Eagle Corporation
Journal Entries in the books of Eagle Corporation for transfer of assets to Sand Corporation
General,Journal
Particular Debit Credit
Investment in Sand Corporation Common stock(Balancing figure) $ 400,000.00
Allowance for uncollectible Accounts Receivable=($45000-$40000) $      5,000.00
Accumulated Depreciation=($300000-$260000) $    40,000.00
Accounts Payable $    10,000.00
   To Cash $         30,000.00
   To Accounts Receivable $         45,000.00
   To Inventory $         60,000.00
   To Land $         20,000.00
   To Building & Equipment $       300,000.00
(Being amount of Assets and Liabilities transfer to Sand Corporation)

ekkarill92 answered 2 years ago
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