Tom Yuppy, a wealthy investor, exchanged a plot of land that originally cost him $31,320 for 1,080 shares of $10 par common stock issued to him by Leuig Corp. On the same date, Leuig Corp. issued an additional 2,160 shares of stock to Yuppy for $29 per share.

Required

a.	What was the value of the land at the date of the stock issue?

Value of the land

b.	Show the effect of the two stock issues on Leuigs books in a horizontal statements model. In the Cash Flow column, indicate whether the item is an operating activity (OA), investing activity (IA), or financing activity (FA). Use NA to indicate that an element was not affected by the event.

Balance Sheet

Income Statement

Event

Assets

=

Stockholders Equity

Revenue

Expense

=

Net Income

Cash Flow

Cash

+

Land

=

Common Stock

+

PIC in Excess

=

1 - Exchange of land for shares

+

=

+

=

2 - Issue of additional shares

+

=

+

=

c.	Prepare the journal entries to record these transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Event 1: record the entry for exchange of land with common stock

Event 2: record the entry for additional issue of shares