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Albuquerque, Inc., acquired 36,000 shares of Marmon Company several years ago for $900,000. At the acquisition...

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Accounting

Albuquerque, Inc., acquired 36,000 shares of Marmon Companyseveral years ago for $900,000. At the acquisition date, Marmonreported a book value of $980,000, and Albuquerque assessed thefair value of the noncontrolling interest at $100,000. Any excessof acquisition-date fair value over book value was assigned tobroadcast licenses with indefinite lives. Since the acquisitiondate and until this point, Marmon has issued no additional shares.No impairment has been recognized for the broadcast licenses.

At the present time, Marmon reports $1,110,000 as totalstockholders’ equity, which is broken down as follows:

Common stock ($11 par value)$440,000
Additional paid-in capital460,000
Retained earnings210,000
Total$1,110,000

View the following as independent situations:

  1. a. & b. Marmon sells 8,000 and 5,000 sharesof previously unissued common stock to the public for $30 and $20per share. Albuquerque purchased none of this stock. What journalentry should Albuquerque make to recognize the impact of this stocktransaction? (If no entry is required for atransaction/event, select "No journal entry required" in the firstaccount field. Do not round your intermediatecalculations.)

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