Question :
Albuquerque, Inc., gets 24,000 shares of Marmon corporation several years ago for $690,000. At the acquisition date, Marmon reported a book value of $800,000, and Albuquerque assessed the fair value of the no controlling interest at $172,500. Any excess of acquisition-date fair value over book value was assigned to broadcast licenses with imprecise lives. Since the acquisition date and until this point, Marmon has issued no additional shares. No impairment has been accepted for the broadcast licenses.
At the current time, Marmon reports $930,000 as total stockholders' equity, which is broken down as follows:
Common stock ($10 par value) $300,000
Additional paid-in capital 320,000
Retained earnings 310,000
Total $930,000
View the subsequent as independent situations:
a.
Marmon sells 10,000 shares of previously unissued common stock to the public for $35 per share. Albuquerque purchased none of this stock. What journal entry could Albuquerque make to recognize the impact of this stock transaction?
General Journal Debit Credit
b.
Marmon sells 2,000 shares of previously unissued common stock to the public for $30 per share. Albuquerque purchased none of this stock. What journal entry could Albuquerque make to recognize the impact of this stock transaction?