Question: Tom Yuppy a wealthy investor exchanged a plot of land

Tom Yuppy, a wealthy investor, exchanged a plot of land that originally cost him $25,000 for 1,000 shares of $10 par common stock issued to him by Leuig Corp. On the same date, Leuig Corp. issued an additional 2,000 shares of stock to Yuppy for $25 per share.
a. What was the value of the land at the date of the stock issue?
b. Show the effect of the two stock issues on Leuig’s books in a horizontal statements model like the following one. In the Cash Flow column, indicate whether the item is an operating activity (OA), investing activity (IA), or financing activity (FA). Use NA to indicate that an element was not affected by the event.
c. Prepare the journal entries to record these transactions.

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  • CreatedApril 20, 2015
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