Plant acquisitions for selected companies are as follows. 1. Sarasota Corporation purchased a company car by making a $4,680 cash down payment and signing a 1-year, $20,800, 10% note payable. The purchase was recorded as follows. Automobiles 27,560 Cash 4,680 Notes Payable 20,800 Interest Payable 2,080 2. As an inducement to locate its new branch office in the city of Greenwood Acres, Ivanhoe Co. received land and a building from the city at no cost. The appraised value of the land was $52,000. The appraised value of the building was $182,000. Since it paid nothing for the land and building, Ivanhoe Co. made no journal entry to record the transaction. 3. Bonita Corporation purchased warehouse shelving for $104,000, terms 1/10, n/30. At the purchase date, Bonita intended to take the discount. Therefore, it made no entry until it paid for the acquisition. The entry was: Warehouse fixtures 104,000 Cash 102,960 Purchase Discounts 1,040 4. Pharoah Company built a piece of equipment for its factory. The cost of constructing the equipment was $166,400. Pharoah could have purchased the equipment for $197,600. The controller made the following entry. Equipment 197,600 Cash, Materials, etc. 166,400 Profir on Construction 31,200 5. Metlock Inc. acquired land, buildings, and equipment from Sale Corp., for a lump-sum price of $1,040,000. The book values of the assets on Sale’s books at the date of purchase, as well as fair values for the assets, based on an appraisal performed shortly before the purchase, were as follows. Asset Book Value Fair Value Land $260,000 $364,000 Buildings 468,000 676,000 Equipment 520,000 312,000 Total $1,248,000 $1,352,000 The company decided to take the lower of the two values for each asset acquired. The following entry was made. Land 260,000 Buildings 468,000 Equipment 312,000 Cash 1,040,000

Plant acquisitions for selected companies are as follows.

1. Sarasota Corporation purchased a company car by making a $4,680 cash down payment and signing a 1-year, $20,800, 10% note payable. The purchase was recorded as follows.

Automobiles	27,560
Cash		4,680
Notes Payable		20,800
Interest Payable		2,080

2. As an inducement to locate its new branch office in the city of Greenwood Acres, Ivanhoe Co. received land and a building from the city at no cost. The appraised value of the land was $52,000. The appraised value of the building was $182,000. Since it paid nothing for the land and building, Ivanhoe Co. made no journal entry to record the transaction.

3. Bonita Corporation purchased warehouse shelving for $104,000, terms 1/10, n/30. At the purchase date, Bonita intended to take the discount. Therefore, it made no entry until it paid for the acquisition. The entry was:

Warehouse fixtures	104,000
Cash		102,960
Purchase Discounts		1,040

4. Pharoah Company built a piece of equipment for its factory. The cost of constructing the equipment was $166,400. Pharoah could have purchased the equipment for $197,600. The controller made the following entry.

Equipment	197,600
Cash, Materials, etc.		166,400
Profir on Construction		31,200

5. Metlock Inc. acquired land, buildings, and equipment from Sale Corp., for a lump-sum price of $1,040,000. The book values of the assets on Sale’s books at the date of purchase, as well as fair values for the assets, based on an appraisal performed shortly before the purchase, were as follows.