Tristar Production Company began operations on September 1, 2021. Listed below are a number of transactions that occurred during its first four months of operations. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) On September 1, the company acquired five acres of land with a building that will be used as a warehouse. Tristar paid $160,000 in cash for the property. According to appraisals, the land had a fair value of $117,000 and the building had a fair value of $63,000. On September 1, Tristar signed a $46,000 noninterest-bearing note to purchase equipment. The $46,000 payment is due on September 1, 2022. Assume that 10% is a reasonable interest rate. On September 15, a truck was donated to the corporation. Similar trucks were selling for $3,100. On September 18, the company paid its lawyer $6,000 for organizing the corporation. On October 10, Tristar purchased maintenance equipment for cash. The purchase price was $21,000 and $800 in freight charges also were paid. On December 2, Tristar acquired various items of office equipment. The company was short of cash and could not pay the $6,100 normal cash price. The supplier agreed to accept 200 shares of the company's no-par common stock in exchange for the equipment. The fair value of the stock is not readily determinable. On December 10, the company acquired a tract of land at a cost of $26,000. It paid $5,000 down and signed a 12% note with both principal and interest due in one year. Twelve percent is an appropriate rate of interest for this note. Required: Prepare journal entries to record each of the above transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round final answers to the nearest whole dollars.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Tristar Production Company began operations on September 1, 2021. Listed below are a number of transactions that occurred during its first four months of operations. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)

On September 1, the company acquired five acres of land with a building that will be used as a warehouse. Tristar paid $160,000 in cash for the property. According to appraisals, the land had a fair value of $117,000 and the building had a fair value of $63,000.
On September 1, Tristar signed a $46,000 noninterest-bearing note to purchase equipment. The $46,000 payment is due on September 1, 2022. Assume that 10% is a reasonable interest rate.
On September 15, a truck was donated to the corporation. Similar trucks were selling for $3,100.
On September 18, the company paid its lawyer $6,000 for organizing the corporation.
On October 10, Tristar purchased maintenance equipment for cash. The purchase price was $21,000 and $800 in freight charges also were paid.
On December 2, Tristar acquired various items of office equipment. The company was short of cash and could not pay the $6,100 normal cash price. The supplier agreed to accept 200 shares of the company's no-par common stock in exchange for the equipment. The fair value of the stock is not readily determinable.
On December 10, the company acquired a tract of land at a cost of $26,000. It paid $5,000 down and signed a 12% note with both principal and interest due in one year. Twelve percent is an appropriate rate of interest for this note.

Required:

Prepare journal entries to record each of the above transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round final answers to the nearest whole dollars.)

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