#1 Jones Co. in a lump-sum purchase, bank note for $2,000,000 and used cas COS ASSET Land $300, Building 825,0 Equipment 750,0 Patent 450,0 Inventory Accounts Receivable 375,C 250,0 Calculate the initial valuation of the ass

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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noc Co. in a lump-sum purchase, acquired all the assets of Jim's manufacturing for $3,000,000. Jones Co secured a
*n note for $2.000,000 and used cash for the balance. The fair value of the assets are as follows:
ASSET
COST
USEFUL LIFE
Land
$300,000
Building
Equipment
825,000
30 YRS
750,000
5 YRS $50,000 salvage value
Patent
450,000
10 YRS
Inventory
Accounts Receivable
375,000
250,000
Calculate the initial valuation of the assets and prepare the journal entry to record the transaction.
Transcribed Image Text:noc Co. in a lump-sum purchase, acquired all the assets of Jim's manufacturing for $3,000,000. Jones Co secured a *n note for $2.000,000 and used cash for the balance. The fair value of the assets are as follows: ASSET COST USEFUL LIFE Land $300,000 Building Equipment 825,000 30 YRS 750,000 5 YRS $50,000 salvage value Patent 450,000 10 YRS Inventory Accounts Receivable 375,000 250,000 Calculate the initial valuation of the assets and prepare the journal entry to record the transaction.
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