See attached file for full problem description.
For your convenience, I have attached a formatted MS Excell spreadsheet containing your original post as well as the corrected entries.
PART VI - PLANT ASSETS: SHORT PROBLEMS
Instructions: Complete the requirements specified for each of the following independent situations.
A. Maddox Company purchased land and a modern office building on March 1 for a combined cash price of $800,000. The land had a cost of $470,000 and the building had a book value of $100,000 on the seller's books. The land and building had fair market values of $520,000 and $280,000, respectively on March 1. Maddox made the following entry at acquisition:
Gain on Purchase 70,000
Accumulated Depreciation 100,000
Prepare the correct entry for the acquisition.
Land (FMV) 520,000
Building (FMV) 280,000
(Entry for the purchase of land and building)
The purchase cost of $470,000 and the book value of $100,000 on the seller's books has nothing to do with the entry to Maddox's journals. Maddox would be required to make entries for the cash that was paid for the land and building, as well as ...
Short Problems Involving Plant Assets