Question

Maltese is a privately-owned company. On September 3, Maltese exchanged 2,000 shares of its private common stock for equipment. There is no readily available estimate of the stock's fair value. The equipment currently is selling for $80,000. The journal entry to record this transaction includes:

Answer 1

Answer:

Debit Equipment 80000

Explanation:

Using the data provided in the question, the journal entry for the transactions will be as follows

     PARTICULARS                                       DEBIT               CREDIT

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   Equipment a/c                                        $80,000

   Common stock a/c                                                            $80,000

(To record equipment exchange

with common stock)

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Hence,

Debit Equipment 80000