Exercise 10-13 Presented below is information related to Marin Company. 1. On Ju
ID: 2578263 • Letter: E
Question
Exercise 10-13
Presented below is information related to Marin Company.
1. On July 6, Marin Company acquired the plant assets of Doonesbury Company, which had discontinued operations. The appraised value of the property is:
$362,000
1,086,000
Marin Company gave 12,500 shares of its $100 par value common stock in exchange. The stock had a market price of $235 per share on the date of the purchase of the property.
2. Marin Company expended the following amounts in cash between July 6 and December 15, the date when it first occupied the building. (Prepare consolidated entry for all transactions below.)
3. On December 20, the company paid cash for equipment, $254,600, subject to a 2% cash discount, and freight on equipment of $11,350.
Prepare entries on the books of Marin Company for these transactions
Land$362,000
Buildings1,086,000
Equipment 724,000 Total $2,172,000Explanation / Answer
Journal Entry Date Particulars Dr. Amt. Cr. Amt. 1 Land Dr. 489,583 Buildings Dr. 1,468,750 Equipment Dr. 979,167 To Common Stock 1,250,000 12,500 Shares X $100 To Paid in Capital in Excess of Par 1,687,500 12,500 Shares X $135 2 Buildings Dr. 272,210 $103,140 + $169,070 Machinery & Equipment Dr. 126,440 Land Improvements Dr. 113,060 Land Dr. 16,570 To Cash 528,280 3 Machinery & Equipment Dr. 260,858 ($254,600 X 98%) + $11,350 To Cash 260,858 Fair Value Weights Allocated Value Land 362,000 16.67% 489,583 Building 1,086,000 50.00% 1,468,750 Equipment 724,000 33.33% 979,167 Total 2,172,000 2,937,500
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