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Prepare the entry to record the purchase of crane galleries

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Question - Fred Moss, owner of Moss Interiors, is negotiating for the purchase of Crane Galleries. The balance sheet of Crane is given in an abbreviated form below.

CRANE GALLERIES BALANCE SHEET AS OF DECEMBER 31, 2017

Assets

Liabilities and Stockholders' Equity

Cash$112,000

Accounts payable$50,300

Land70,700

Notes payable (long-term)299,800

Buildings (net)200,700

Total liabilities350,100

Equipment (net)175,700

Common stock$201,400

Copyrights (net)30,700

Retained earnings38,300

239,700

Total assets$589,800

Total liabilities and stockholders' equity$589,800

Moss and Crane agree that:

1. Land is undervalued by $41,900.2.Equipment is overvalued by $5,000. Crane agrees to sell the gallery to Moss for $378,600.

Prepare the entry to record the purchase of Crane Galleries on Moss's books?

Reference no: EM131661425

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