Question

BE10.7 (LO 3) Fielder Company obtained land by issuing 2,000 shares of its $10 par value common stock. The land was recently appraised at $85,000. The common stock is actively traded at $40 per share. Prepare the journal entry to record the acquisition of the land.

BE10.8 (LO 3) Navajo Corporation traded a used truck (cost $20,000, accumulated depreciation $18,000) for a small computer with a fair value of $3,300. Navajo also paid $500 in the transaction. Prepare the journal entry to record the exchange. (The exchange has commercial substance.)

Answer 1

 

 

BRIEF EXERCISE 10-7

 

Land (2,000 X $40).................................................	80,000
Common Stock (2,000 X $10)....................		20,000
Paid-in Capital in Excess of Par—                Common Stock........................................		60,000

BRIEF EXERCISE 10-8

 

 

Equipment...............................................................	3,300
Accumulated Depreciation—Trucks.................	18,000
Trucks............................................................		20,000
Cash...............................................................		500
Gain on Disposal of Trucks.......................		800

 

 

BRIEF EXERCISE 10-7

 

Land (2,000 X $40).................................................	80,000
Common Stock (2,000 X $10)....................		20,000
Paid-in Capital in Excess of Par—                Common Stock........................................		60,000

BRIEF EXERCISE 10-8

 

 

Equipment...............................................................	3,300
Accumulated Depreciation—Trucks.................	18,000
Trucks............................................................		20,000
Cash...............................................................		500
Gain on Disposal of Trucks.......................		800