Create an Account

Already have account?

Forgot Your Password ?

Home / Questions / Presented below is information related to Rommel Company 1 On July 6 Rommel Company acqui...

Presented below is information related to Rommel Company 1 On July 6 Rommel Company acquired the plant assets of Studebaker Company which had discontinued operations The appraised value of the

Presented below is information related to Rommel Company.

1. On July 6, Rommel Company acquired the plant assets of Studebaker Company, which had discontinued operations. The appraised value of the property is:

Land

$   400,000

Buildings

1,200,000  

Equipment

800,000

Total

$2,400,000  

Rommel Company gave 12,500 shares of its $100 par value common stock in exchange. The stock had a fair value of $180 per share on the date of the purchase of the property.

2. Rommel Company expended the following amounts in cash between July 6 and December 15, the date when it first occupied the building.

Repairs to building

$105,000  

Construction of bases for   machinery to be installed later

135,000  

Driveways and parking lots

122,000  

Remodeling of office space in   building, including new partitions and walls

161,000  

Special assessment by city on   land

18,000  

3. On December 20, the company paid cash for machinery, $280,000, subject to a 2% cash discount, and freight on machinery of $10,500.

Instructions

Prepare entries on the books of Rommel Company for these transactions.

May 21 2020 View more View Less

Answer (Solved)

question Subscribe To Get Solution

Related Questions