On July 16, 20YI1, Wyatt Corp. purchased acres of land for $350. The land has been held for a future plant site until the current date, December 31 20Y9. On December 18, 20Y9, TexoPete Inc. purchased 40 acres of land for $2,000,000 to be used for a distribution center. the TexoPete land is located next to the Wyatt corp. land. thus, both Wyatt corp. and TexoPete inc. own nearly identical pieces of land. What are the valuation of land on the balance sheets of Wyatt corp. and TexoPete inc. using generally accepted accounting principles? how might fair value accounting aid comparability when evaluating these two companies?

On July 16, 20YI1, Wyatt Corp. purchased acres of land for $350. The land has been held for a future plant site until the current date, December 31 20Y9. On December 18, 20Y9, TexoPete Inc. purchased 40 acres of land for $2,000,000 to be used for a distribution center. the TexoPete land is located next to the Wyatt corp. land. thus, both Wyatt corp. and TexoPete inc. own nearly identical pieces of land. What are the valuation of land on the balance sheets of Wyatt corp. and TexoPete inc. using generally accepted accounting principles? how might fair value accounting aid comparability when evaluating these two companies?

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter6: Corporations: Redemptions And Liquidations

Section: Chapter Questions

Problem 56P

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On July 16, 20Y1, Wyatt Corp. purchased 40 acres of land for $350,000. The land has been held for a future plant site until the current date, December 31, 20Y9. On December 18, 20Y9, TexoPete Inc. purchased 40 acres of land for $2,000,000 to be used for a distribution center. The TexoPete land is located next to the Wyatt Corp. land. Thus, both Wyatt Corp. and TexoPete Inc. own nearly identical pieces of land.1. What are the valuations of land on the balance sheets of Wyatt Corp. and TexoPete Inc. using generally accepted accounting principles?2. How might fair value accounting aid comparability when evaluating these two companies?
On July 16,20Y1, Wyatt Corp. purchased 40 acres of land for $350,000. The land has been held for a future plant site until the current date, December 31, 20Y9. On December 18, 20Y9, TexPete land Inc. purchased 40 acres of land for $2,000,000 to be used for a distribution center. The TexoPete land is located next to the Wyatt Corp. land. Thus both Wyatt Corp. and TexoPete Inc. own nearly identical pieces of land. 1. What are the valuations of the land on the balance sheets of Wyatt Corp. and TexoPete Inc. using generally accepted accounting principles? 2. How might fair value accounting aid comparability when evaluating these two companies?
The Tinsley Company exchanged land that it had been holding for future plant expansion for a more suitable parcel located farther from residential areas. Tinsley carried the land at its original cost of $30,000. According to an independent appraisal, the land currently is worth $72,000. Tinsley paid $14,000 in cash to complete the transaction. Required: 1. What is the fair value of the new parcel of land received by Tinsley? 2. Prepare the journal entry to record the exchange assuming the exchange has commercial substance. 3. Prepare the journal entry to record the exchange assuming the exchange lacks commercial substance.
The Tinsley Company exchanged land that it had been holding for future plant expansion for a more suitable parcel located farther from residential areas. Tinsley carried the land at its original cost of $30,000. According to an independent appraisal, the land currently is worth $72,000. Tinsley paid $14,000 in cash to complete the transaction.Required:1. What is the fair value of the new parcel of land received by Tinsley?2. Prepare the journal entry to record the exchange assuming the exchange has commercial substance.3. Prepare the journal entry to record the exchange assuming the exchange lacks commercial substance.4. Prepare the journal entry to record the exchange except that Tinsley received $9,000 in the exchange, and the exchange lacks commercial substance.
On January 1, 20X1, the city government of Faraway donated property to Amazing, Inc., in return for the commitment from the company that it would build a manufacturing plant on the site and employ residents of the city in the plant. Information on the donated land appears below. Cost of the land paid by Faraway = $1,000,000 Fair valiue of the land at time of donation = $1,865,000 What is the donation revenue recognized by Amazing, Inc.?
The Tinsley Company exchanged land that it had been holding for future plant expansion for a more suitableparcel located farther from residential areas. Tinsley carried the land at its original cost of $30,000. Accordingto an independent appraisal, the land currently is worth $72,000. Tinsley paid $14,000 in cash to complete thetransaction.Required:1. What is the fair value of the new parcel of land received by Tinsley?2. Prepare the journal entry to record the exchange assuming the exchange has commercial substance
Fresh Veggies, Incorporated (FVI), purchases land and a warehouse for $490,000. In addition to the purchase price, FVI makes the following expenditures related to the acquisition: broker's commission, $29,000; title insurance, $1,900; and miscellaneous closing costs, $6,000. The warehouse is immediately demolished at a cost of $29,000 in anticipation of building a new warehouse. Determine the cost of the land and record the purchase (assuming cash was paid for all expenditures). (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Record the purchase of the land. Note: Enter debits before credits. Transaction 1 Record entry General Journal Clear entry Debit Credit View general Journal
Halyu Corp., a domestic corporation, sold a parcel of land with the following details: The land has a Transfer Certificate of Title No. 109201. It is an agricultural property situated in the municipality of Lopez, Quezon province, with an area of 2,500 square meters. The land was acquired in 2004 for a purchase price of P500,000. At the time of the sale, the land's fair market value stands at P7,500,000, which aligns with the prevailing market values set by the Sanggunian. The agreed consideration for the sale is P6,700,000. How much is the documentary stamp tax from the sale? P56,250 P50,250 P112,500 P100,500
On April 1, Proton Corporation purchased for P855,000 a tract of land on which was located a warehouse and office building. The following data were collected concerning the property: Current Assessed Valuation Vendor's Original Cost Land P300,000 P280,000 Warehouse 200,000 180,000 Office building 340,000 P900,000 P800,000 What are the appropriate amounts that Proton should record for the land, warehouse, and office building, respectively? O Land, P299,250; warehouse, P192,375; office building, P363,375. O Land, P300,000; warehouse, P200,000; office building, P400,000. O Land, P280,000; warehouse, P180,000; office building, P340,000. O Land, P285,000; warehouse, P190,000; office building, P380,000. 400,000
Below are transactions related to Martinez Company. The City of Pebble Beach gives the company 5 acres of land as a plant site. The fair value of this land is determined to be $87,350. (a) 13,000 shares of common stock with a par value of $55 per share are issued in exchange for land and buildings. The property has been appraised at a fair value of $873,500, of which $175,190 has been allocated to land and $698,310 to buildings. The stock of Martinez Company is not listed on any exchange, but a block of 100 shares was sold by a stockholder 12 months ago at $71 per share, and a block of 200 shares was sold by another stockholder 18 months ago at $63 per share. (b) (c) No entry has been made to remove from the accounts for Materials, Direct Labor, and Overhead the amounts properly chargeable to plant asset accounts for machinery constructed during the year. The following information is given relative to costs of the machinery constructed. Materials used $11,300 Factory supplies used 846…
Below are transactions related to Martinez Company. The City of Pebble Beach gives the company 5 acres of land as a plant site. The fair value of this land is determined to be $87,350. (a) 13,000 shares of common stock with a par value of $55 per share are issued in exchange for land and buildings. The property has been appraised at a fair value of $873,500, of which $175,190 has been allocated to land and $698,310 to buildings. The stock of Martinez Company is not listed on any exchange, but a block of 100 shares was sold by a stockholder 12 months ago at $71 per share, and a block of 200 shares was sold by another stockholder 18 months ago at $63 per share. (b) No entry has been made to remove from the accounts for Materials, Direct Labor, and Overhead the amounts properly chargeable to plant asset accounts for machinery constructed during the year. The following information is given relative to costs of the machinery constructed. (c) Materials used $11,300 Factory supplies used 846…
The company has recieved a donation of land from a rich local philanhropist. the land originally cost the philanhropist $48,000. on the date of the donation, it had a market value of $111,000. Make the journal entry necessary on the book of the company to record the receipt of the land