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TXA Ltd acquired a machine from Blue Ltd for the following consideration: Cash $70, 000 Land in the books of TXA Ltd the land is

TXA Ltd acquired a machine from Blue Ltd for the following consideration:

Cash $70, 000

Land in the books of TXA Ltd the land is recorded at its cost of $650,000. It has a fair value of $450,000.

TXA Ltd also agrees to assume the liability of the Blue Ltd bank loan of $89,000 as part of the machine acquisition. Required:

(a) Calculate the acquisition cost of the machine.

(b) Provide the journal entries that would appear in TXA Ltd.’s books to account for the acquisition of the Machine.

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