sudoku company issues 32,000 shares of $6 par value common stock in exchange for land and a building. the…

sudoku company issues 32,000 shares of $6 par value common stock in exchange for land and a building. the land is valued at $239,000 and the building at $366,000. prepare the journal entry to record issuance of the stock in exchange for the land and building.\njournal entry worksheet\nrecord the issue of 32,000 shares of $6 par value common stock in exchange for land valued at $239,000 and a building valued at $366,000.\nnote: enter debits before credits.

sudoku company issues 32,000 shares of $6 par value common stock in exchange for land and a building. the land is valued at $239,000 and the building at $366,000. prepare the journal entry to record issuance of the stock in exchange for the land and building.\njournal entry worksheet\nrecord the issue of 32,000 shares of $6 par value common stock in exchange for land valued at $239,000 and a building valued at $366,000.\nnote: enter debits before credits.

Answer

Explanation:

Step1: Calculate the total value of land and building

The land is valued at ( $239,000 ) and the building at ( $366,000 ). The total value (=239000 + 366000=$605,000)

Step2: Calculate the par - value of the common stock

The company issues ( 32,000 ) shares of ( $6 ) par - value common stock. The par - value (=32000\times6=$192,000)

Step3: Calculate the paid - in capital in excess of par

Paid - in capital in excess of par (=) Total value of assets received - Par - value of stock (=605000 - 192000=$413,000)

Step4: Record the journal entry

Debit Land ( $239,000 ), debit Building ( $366,000 ) (to record the assets received). Credit Common Stock ( $192,000 ) (at par - value) and credit Paid - in Capital in Excess of Par - Common Stock ( $413,000 ) (the amount in excess of par).

Answer:

Transaction General Journal Debit Credit
1 Land ( 239000 )
Building ( 366000 )
Common Stock ( 192000 )
Paid - in Capital in Excess of Par - Common Stock ( 413000 )