Fred Moss, owner of Moss Interiors, is negotiating for the purchase of Zweifel Galleries. The balance sheet of Zweifel is given in an abbreviated form below.

Moss and Zweifel agree that:
1. Land is undervalued by $30,000.
2. Equipment is overvalued by $5,000.
Zweifel agrees to sell the gallery to Moss for $350,000.

Instructions
Prepare the entry to record the purchase of Zweifel Galleries on Moss'sbooks.

Transcribed Image Text:

Zweifel Galleries Balance Sheet As of December 31, 2008 Assets Liabilities and Stockholders' Equity $ 50,000 300,000 350,000 Cash Land Building (net) Equipment (net Copyright (net) Total assets $100,000 Accounts payable 70,000 Long-term notes payable 200,000Total liabilities 175,000 Common stock 30,000 Retained eamings $200,000 25,000 225,000 $575,000 Total liabilities and stockholders' equity $575,000