Minor Corp. has agreed to expand its operations by opening a manufacturing plant in Bel Air, Maryland. In return, Bel Air will donate an abandoned building and the 5 acres on which it sits to Minor. The land originally cost
$1,000,000 and the building $3,000,000. The building's current book value is $380,000, and current appraisals are: land
$8,000,000 and building $3,600,000. Minor has also agreed to provide 100 jobs for the next 5 years to Bel Airs' city residents. Minor estimates that the wages to these residents will amount to $4,000,000.
Required:
Prepare the journal entry to record this acquisition on Minor's books.

Question

Quizplus · Accepted Answer

The Answer of Minor Corp. has agreed to expand its operations by opening a manufacturing plant in Bel Air, Maryland. In return, Bel Air will donate an abandoned building and the 5 acres on which it sits to Minor. The land originally cost
$1,000,000 and the building $3,000,000. The building's current book value is $380,000, and current appraisals are: land
$8,000,000 and building $3,600,000. Minor has also agreed to provide 100 jobs for the next 5 years to Bel Airs' city residents. Minor estimates that the wages to these residents will amount to $4,000,000.
Required:
Prepare the journal entry to record this acquisition on Minor's books.