2. The Harris Corporation acquired a building and land by issuing 25,000 shares
ID: 2341337 • Letter: 2
Question
2. The Harris Corporation acquired a building and land by issuing 25,000 shares of $1 par common stock. At that time, the stock was selling for $12 per share on the New York Stock Exchange. The independently appraised values of the building and the land were $250,000 and $150,000 respectively. Prepare the journal entry for the acquisition of the building and land. (Use 3 decimal points for allocation calculations) 2. The Harris Corporation acquired a building and land by issuing 25,000 shares of $1 par common stock. At that time, the stock was selling for $12 per share on the New York Stock Exchange. The independently appraised values of the building and the land were $250,000 and $150,000 respectively. Prepare the journal entry for the acquisition of the building and land. (Use 3 decimal points for allocation calculations)Explanation / Answer
WN:
Cost of the land and building is calculated as follows:
The appraised value of the land is $150000
The appriased value of the building is $250000.
Cost of Land =$150000/$400000*(25000*12)
=$112500
Cost of building =$250000/$400000*(25000*12)
=$187500
The following is the Journal Entry to record these
In the Books Of Harris Corporation
Journal Entry
SNno Account Title Dr Amount Cr Amount
1 land $112500
Buidling $187500
To Common Stock (25000 Shares $1 par) $25000
To Additional Paid in Capital on common $275000
stock
(25000 shares *$11)
to record the investment in Land and Building
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.