Chapter 10 Homework Question 7 of 17 > - -/18 Vimw Policies Current Attempt in Progress Coronado Industries purchased the following assets and constructed a building as well. All this was done during the current year Assets 1 and 2: These assets were purchased as a lump sum for $350,000 cash. The following information was gathered. Initial Cost on Seller's Books Depreciation to Date on Seller's Books Book Value on Seller's Books Description Appraised Value Machinery $350,000 $175.000 $175,000 $315.000 Equipment 210,000 35,000 175.000 105.000 Asset 3: This machine was acquired by making a $35.000 down payment and issuing a $105.000, 2-year, zero-interest-bearing note, The note is to be paid off in two $52,500 installments made at the end of the first and second years. It was estimated that the asset could have been purchased outright for $125,650. Asset 4: This machinery was acquired by trading in used machinery. (The exchange lacks commercial substance.) Facts concerning the trade-in are as follows. $350,000 Cost of machinery traded Accumulated depreciation to date of sale 140,000 Fair value of machinery traded 280,000 Cash received 35,000 Fair value of machinery acquired 245,000 Asset 5: Equipment was acquired by issuing 100 shares of $28 par value common stock. The stock had a market price of $39 per share. Construction of Building: A building was constructed on land purchased last year at a cost of $525,000. Construction began on February 1 and was completed on November 1. The payments to the contractor were as follows Date Payment 2/1 $420,000 Question 7 of 17 > -/1 E Date Payment 2/1 $420,000 6/1 1,260,000 9/1 1,680,000 11/1 350,000 To finance construction of the building, a $2.100,000, 12% construction loan was taken out on February 1. The loan was repaid on November 1. The firm had $700.000 of other outstanding debt during the year at a borrowing rate of 8%. Record the acquisition of each of these assets. (Round Intermediate calculations to 5 decimal places, eg 1.25124 and final answer too decimal places eg. 58,971. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts) Account Titles and Explanation Debit Credit Acquisition of Assets 1 and 2 Acquisition of Asset 3 Acquisition of Asset 4 E Chapter 10 Homework Question 7 of 17 > -/1 Debit Credit Account Titles and Explanation Acquisition of Assets 1 and 2 Acquisition of Asset 3 Acquisition of Asset 4 Acquisition of Assets Question 7 of 17 > -/1 Acquisition of Assets To record acquisition of Office Equipment eTextbook and Media List of Accounts Save for Later Attempts: 0 of 3 used Submit