Question

Presented below is information related to Sandhill Company. 1. On July 6, Sandhill Company acquired the plant assets of Doonesbury Company, which had discontinued operations. The appraised value of the property is: Land Buildings Equipment Total $600,000 1,800,000 1,200,000 $3,600,000 Sandhill Company gave 12,500 shares of its $100 par value common stock in exchange. The stock had a market price of $168 per share on the date of the purchase of the property. 2. Sandhill 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.) Repairs to building Construction of bases for equipment to be installed later Driveways and parking lots Remodeling of office space in building including new partitions and walls Special assessment by city on land $262,500 337,500 305,000 402.500 45,000 3. On December 20, the company paid cash for equipment, $650,000, subject to a 2% cash discount, and freight on equipment of $26,250. Prepare entries on the books of Sandhill Company for these transactions. (Round intermediate calculations to 5 decimal places, eg. 1.25124 and final answer to O decimal places eg. 58,971. Credit account titles ar required, select "No Entry" for the account titles and enter O for the amounts.) Debit Credit No. Account Titles and Explanation 1.

Answer 1

Date	Accounts Title And Explanation	Debit	Credit
July 6th	Land	$350,000
	Building	$1050,000
	Machinery and Equipment	$700,000
	Common Stock(12500*100)		$1250,000
	Paid-In Capital in Excess of Par		$850,000
	(The cost of the Plan assets is 12500*168=2100,000 is
	Apportioned to land ,Building, Machinery and Equipment
	in the ratio of value of Assets,600,000,1800,000,1200,000)
July 6th
	Buildings(262,500+402,500)	$665,000
	Machinery And Equipment	$337,500
	Land Improvements	$305000
	Land	$45000
	Cash		$1,352,500
	(To Record Capital Expenses Incurred)
December 20th	Machinery And Equipment	$663,250
	To Cash		$663,250
	( To record the purchase of Equipment and all incidental expenses to bring the Equipment to the location 26250+650000*98%=309014