Question

Sudoku Company issues 28,000 shares of $6 par value common stock in exchange for land and a building. The land is valued at $243,000 and the building at $370,000. Prepare the journal entry to record issuance of the stock in exchange for the land and building.

Answer 1

Step-by-step explanation:

The journal entry is shown below:

Land A/c Dr $243,000

Building A/c Dr $370,000

To Common stock A/c $168,000 (28,000 shares × $6)

To Paid-in capital in excess of par value - common stock $445,000

(Being the issuance of the common stock in exchange of land and building)

Simply we debited the land account and building account and credited the common stock and paid in capital in excess of par value