Homework Answers
Solution
| Transaction | General journal | Debit | Credit |
| 1 | Land | $ 246,000.00 | |
| Building | $ 307,500.00 | ||
| Equipment | $ 492,000.00 | ||
| Inventories | $ 184,500.00 | ||
| Cash | $ 1,230,000.00 | ||
| (To record purchase of assets) |
Working
| Land | Building | Equipment | Inventories | Total | |
| Fair Value | $ 272,000 | $ 340,000 | $ 544,000 | $ 204,000 | $ 1,360,000 |
| Lumpsum amount paid | $ 1,230,000 | ||||
| Allocation of lumpsum amount in ratio of fair value value | $ 246,000 | $ 307,500 | $ 492,000 | $ 184,500 | $ 1,230,000 |
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