Presented below is information related to Nash Company. 1. On July 6, Nash Compa
ID: 2530487 • Letter: P
Question
Presented below is information related to Nash Company.
1. On July 6, Nash Company acquired the plant assets of Doonesbury Company, which had discontinued operations. The appraised value of the property is:
$406,000
1,218,000
Nash Company gave 12,500 shares of its $100 par value common stock in exchange. The stock had a market price of $212 per share on the date of the purchase of the property.
2. Nash 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.)
3. On December 20, the company paid cash for equipment, $295,200, subject to a 2% cash discount, and freight on equipment of $11,080.
Prepare entries on the books of Nash Company for these transactions. (Round intermediate calculations to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places e.g. 58,971. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
No.
Account Titles and Explanation
Debit
Credit
1.
2.
3.
Land$406,000
Buildings1,218,000
Equipment 812,000 Total $2,436,000Explanation / Answer
(being machinery purchased recorded)
No Accounts title Dr Cr 1 Building $441,667 Machinery & equipment $1,325,000 Land $883,333 Share capital-ordinary (12500*100) $1,250,000 Share PremuimOrdinary 1400000 12500*(212-100) Appraised value % Total value to be allocated Value alloacted Land $406,000 16.67 $2,650,000 $441,667 Buildings 1,218,000 50.00 $2,650,000 $1,325,000 Equipment 812,000 33.33 $2,650,000 $883,333 Total $2,436,000 $2,650,000 2 Building (101830+152260) 254090 Machinery & equipment $128,250 Land Improvements 125120 Land 17730 Cash 525190 (being assets purcahsed for cash) 3 Machinery & equipment 300376 Cash 300376 (295200*98%)+11080