Kirby, Paul Glenn, UBJ. 3 EX 13-6 Selected stock transactions Alpha Sounds Corp., an electric guitar retailer, was organized by Michele Kirby, Paul cu and Gretchen Northway. The charter authorized 1,000,000 shares of common stock a par of $1. The following transactions affecting stockholders' equity were completed during the first year of operations: a. Issued 100,000 shares of stock at par to Paul Glenn for cash. b. Issued 3,000 shares of stock at par to Michele Kirby for promotional services provided in connection with the organization of the corporation and issued 45,000 shares of stock at par to Michele Kirby for cash. c. Purchased land and a building from Gretchen Northway in exchange for stock issued at par. The building is mortgaged for $180,000 for 20 years at 6%, and there is accrued interest of $5,200 on the mortgage note at the time of the purchase. It is agreed that the land is to be priced at $60,000 and the building at $225,000 and that Gretchen Northway's equity will be exchanged for stock at par. The corporation agreed to assume responsibility for paying the mortgage note and the accrued interest. Journalize the entries to record the transactions. Chapter 15 Investments and Fair Value Accounting CP 15-4 Benefits of fair value On July 16, 20Y1, Wyatt Corp. purchased 40 acres of land for $350,000. The land has been held for a future plant site until the current date, December 31, 20Y9. On December 18, 2049, TexoPete Inc, purchased 40 acres of land for $2,000,000 to be used for a distribu- tion center. The Texo Pete land is located next to the Wyatt Corp. land. Thus, both Wyatt Corp. and TexoPete Inc. own nearly identical pieces of land. 1. What are the valuations of land on the balance sheets of Wyatt Corp. and Texo Pete Inc, using generally accepted accounting principles? 2. How might fair value accounting aid comparability when evaluating these two companies