Situation 3: A shareholder of WonWon Corporation gave the corporation a piece of land as a plant site. The fair value of this land is determined to be P500,000. Situation 4: YoYo Company paid cash for machinery, P900,000 subject to a 2% cash discount if paid within 15 days, and freight on machinery, P35,000. YoYo paid beyond the 15 day period and therefore did not take the cash discount. Situation 5: LaLa Company acquired furniture and fixtures by issuing a P400,000 two year noninterest-bearing note. In similar transactions, the entity has paid 12% interest. Round off present value factors to three decimal places (e.g., 6.667) Questions: a. For Afable Company, how much was the initial cost of Land, Building, and Machinery? b. For WonWon Corporation, provide the journal entry to record the receipt of the land from the shar c. How much would YoYo Company record as the cost of the machinery? d. How much would LaLa Company record as the cost of the furniture and fixtures?
Situation 3: A shareholder of WonWon Corporation gave the corporation a piece of land as a plant site. The fair value of this land is determined to be P500,000. Situation 4: YoYo Company paid cash for machinery, P900,000 subject to a 2% cash discount if paid within 15 days, and freight on machinery, P35,000. YoYo paid beyond the 15 day period and therefore did not take the cash discount. Situation 5: LaLa Company acquired furniture and fixtures by issuing a P400,000 two year noninterest-bearing note. In similar transactions, the entity has paid 12% interest. Round off present value factors to three decimal places (e.g., 6.667) Questions: a. For Afable Company, how much was the initial cost of Land, Building, and Machinery? b. For WonWon Corporation, provide the journal entry to record the receipt of the land from the shar c. How much would YoYo Company record as the cost of the machinery? d. How much would LaLa Company record as the cost of the furniture and fixtures?
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter8: Operating Assets: Property, Plant, And Equipment, And Intangibles
Section: Chapter Questions
Problem 8.1AP
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