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Lester Company transferred the following assets to a newly created subsidiary, Mumby Corporation, in exchange for 40,000 shares of its $3 par value stock: Cost
- Lester Company transferred the following assets to a newly created subsidiary, Mumby Corporation, in exchange for 40,000 shares of its $3 par value stock:
| Cost | Book Value |
Cash | $ 40,000 | $ 40,000 |
Accounts Receivable | 75,000 | 68,000 |
Inventory | 50,000 | 50,000 |
Land | 35,000 | 35,000 |
Building | 160,000 | 125,000 |
Equipment | 240,000 | 180,000 |
- Give the journal entry in which Lester recorded the transfer of assets to Mumby Corporation. (solution in Microsoft word)
- Give the journal entry in which Mumby recorded the receipt of assets and issuance of common stock to Lester. ( solution in Microsoft word )
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