Question

Tristar Production Company began operations on September 1, 2018. Listed below are a number of transactions that occurred during its first four months of operations. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) 1. On September 1, the company acquired five acres of land with a building that will be used as a warehouse. Tristar paid $110,000 in cash for the property. According to appraisals, the land had a fair value of $78,000 and the building had a fair value of $52,000 2. On September 1, Tristar signed a $41,000 noninterest-bearing note to purchase equipment. The $41,000 payment is due on September 1, 2019. Assume that 8% is a reasonable interest rate. 3. On September 15, a truck was donated to the corporation. Similar trucks were selling for $2,600 4. On September 18, the company paid its lawyer $3,500 for organizing the corporation. 5. On October 10, Tristar purchased maintenance equipment for cash. The purchase price was $16,000 and $550 in freight charges also were paid. 6. On December 2, Tristar acquired various items of office equipment. The company was short of cash and could not pay the $5,600 normal cash price. The supplier agreed to accept 200 shares of the company's nopar common stock in exchange for the equipment. The fair value of the stock is not readily determinable. 7 On December 10, the company acquired a tract of land at a cost of $21,000. It paid $2,500 down and signed a 10% note with both principal and interest due in one year. Ten percent is an appropriate rate of interest for this note. Required: Prepare journal entries to record each of the above transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round final answers to the nearest whole dollars.)

Answer 1

solution Date I a Delet Credit Account title & Explanation Land (1100004 48000 / (78000 + 52000)) Bulding (110000 x 52000/( 48000 +52000)] 66000 44000 cash T10000 for Land es [ To recard payment building] 41000 2 3280 Equipment Discount on Note payable Note payable [ To record equipment purchase] 44280 2600 3. 2600 Truck Revenue - Donation of asset [ To record truck in donation] 3500 Organization cost expenses 3500 cash [ To record olgaresing cost paed] {quapment 16550 Cash 16550

5600 office equepment Common Stock 5600 21000 Land 2500 cash Note poyable 28500