Question 1 - On May 1, 2008, Lenny Corporation purchased for $690,000 a tract of land on which a warehouse and office building were located. The following data were collected concerning the property:
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Current Assessed Valuation
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Vendor's Original Cost
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Land
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$280,000
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$180,000
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Warehouse
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320,000
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315,000
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Office Building
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200,000
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129,000
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$800,000
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$624,000
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Determine the appropriate amounts that Lenny should record for the land, warehouse, and office building.
Question 2 - The Callister Company exchanged 25,000 shares of its own $50 par value common stock for a turret lathe from Payne Company. The market value of the Callister Company stock was $68 per share at the date of exchange. The equipment had a carrying value of $1,625,000.
Record the exchange on the books of Callister Company in general journal form.