Sudoku Company issues 26,000 shares of $7 par value common stock in exchange for land and a building. The land is valued at $230,000 and the building at $374,000. Prepare the journal entry to record issuance of the stock in exchange for the land and building.

Dr Land 230,000

Dr Building374,000

Cr Common stock $7 par value 182,000

Cr Paid-in capital in excess of parvalue, common stock 422,000

Explanation:

Preparation of the journal entry to record issuance of the stock in exchange for the land and building.

Dr Land 230,000

Dr Building374,000

Cr Common stock $7 par value 182,000

(26,000 shares x $7 par)

Cr Paid-in capital in excess of parvalue, common stock 422,000

Calculation for Paid-in capital in excess of par value, common stock

Paid-in capital in excess of par value, common stock=(230,000 + 374,000) – 182,000

Paid-in capital in excess of par value, common stock=604,000-182,000

Paid-in capital in excess of par value, common stock= 422,000