In late September 2020, Federation Construction Services Pty Ltd (FCS) acquires the following items from another entity for $600,000 cash: land, building, and equipment. In addition to the acquisition price, stamp duty of $20,000, clean-up of hazardous pollution on the land of $35,000, and safety repairs and upgrades on the equipment of $8,000 were incurred. These assets are not part of a business combination. After consulting with relevant experts, the following fair values for the acquired assets were estimated as follows: Fair values Land $350,000 Building $150,000 Equipment $250,000 Prepare the journal entries for all these transactions
In late September 2020, Federation Construction Services Pty Ltd (FCS) acquires the following items from another entity for $600,000 cash: land, building, and equipment. In addition to the acquisition price, stamp duty of $20,000, clean-up of hazardous pollution on the land of $35,000, and safety repairs and upgrades on the equipment of $8,000 were incurred. These assets are not part of a business combination. After consulting with relevant experts, the following fair values for the acquired assets were estimated as follows: Fair values Land $350,000 Building $150,000 Equipment $250,000 Prepare the journal entries for all these transactions
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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In late September 2020, Federation Construction Services Pty Ltd (FCS) acquires the following items from another entity for $600,000 cash: land, building, and equipment. In addition to the acquisition price, stamp duty of $20,000, clean-up of hazardous pollution on the land of $35,000, and safety repairs and upgrades on the equipment of $8,000 were incurred. These assets are not part of a business combination. After consulting with relevant experts, the following fair values for the acquired assets were estimated as follows:
Fair values
Land $350,000
Building $150,000
Equipment $250,000
Prepare the
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