E10.16 (LO 2, 3) Groupwork Asset Acquisition) Hayes Industries purchased the following assets and constructed a building as well. All this was done during the current year. Assets land 2: These assets were purchased as a lump sum for $100,000 cash. The following information was gathered Description Machinery Equipment Initial Coston Seller's Books $100,000 60,000 Depreciation to Date on Seller's Books $50,000 10,000 Book Value on Seller's Books $50,000 50,000 Appraised Value $90,000 30,000 Asset 3: This machine was acquired by making a $10,000 down payment and issuing a $30,000, 2 year, zero interest-bearing note. The note is to be paid off in two $15.000 installments made at the end of the first and second years. It was estimated that the asset could have been purchased outright for $35.900. Asset 4: This machinery was acquired by trading in used machinery, (The exchange tacks commercial substance.) Facts concerning the trade-in are as follows. Cost of machinery traded $100,000 Accumulated depreciation to date of sale 40,000 Fair value of machinery traded 80,000 Cash received 10,000 Fair value of machinery acquired 70,000 Asset 5: Equipment was acquired by Issuing 100 shares of SR par value common stock. The stock had a market price of S11 per share. Construction of Huilding: A building was constructed on land purchased last year at a cost of $150,000 Construction began on February 1 and was completed on November 1. The payments to the contractor were as follows Dale Payment $120,000 160.000 480,000 100,000 To finance construction of the building, a $600,000, 12 construction loan was taken out on February 1. The loan was repaid on November 1 The firm had $200,000 of other outstanding debt during the year at a borrowing rate of 2/1 Instructions Record the acquisition of each of these assets