Erica Company had the following property acquisitions during the current year:
1. Acquired a tract of land and building in exchange for 50,000 ordinary shares with P100 par value and market price of P120 per share on the date of acquisition. The last property task bill indicated assessed value of P1,200,000 for the land and P2,800,000 for the building.
However, the land has a fair value of P2,000,000 and the building has fair value of P3,500,000.
2. Received land from a major shareholder as an inducement to locate a plant in the city. No payment was required but the entity paid P50,000 for legal expenses for land transfer. The land is fairly valued at P1,000,000.
3. Acquired a machine with an invoice price of P3,000,000 subject to a cash discount of 10% which was not taken.
The entity incurred cost of P50,000 in removing the old machine prior to the installation of the new one. Spare parts were acquired at a cost of P150,000.
Required:
Prepare journal entries to record transactions for the current year.