Part 1:

Meurer, Inc. purchased the following assets and constructed a building as well. All this was done during the current year.

Assets 1& 2

These assets were purchased as a lump sum for $186,000 cash. The following information was gathered.

Description	Initial Cost on Seller's Books	Depreciation to Date on Seller's Books	Book Value on Seller's Books	Appraised Value
Machinery	$65,000	$30,000	$35,000	$160,000
Office Furniture	25,000	10,000	15,000	40,000

Asset 3

This machinery was acquired by trading in used machinery. (The exchange lacks commercial substance.) Facts concerning the trade-in as follows.

Cost of machinery traded	$150,000
Accumulated depreciation to date of sale	60,000
Fair value of machinery traded	96,000
Cash Received	20,000
Fair value of machinery acquired	76,000

Asset 4:

Machinery was acquired by issuing 1,000 shares of $1 par value common stock. The stock had a market value of $7 per share.

Asset 5:

Truck has a list price of $20,000 and is acquired on April 1, 2015 with a down payment of $3,000 cash and a zero-interest-bearing note with a face amount of $16,000. The note is due April 1, 2016. Meurer, Inc. would normally have to pay interest at a rate of 10% for such a borrowing, and the dealership has an incremental borrowing rate of 8%.

Asset 6:

Construction of Building

A building was constructed on land (purchased on March 1 with cash) at a cost of $120,000. Construction began on March 1 and was completed on September 1. The payments to the contractor were as follows.

Date	Payment
3/1	$200,000
5/1	300,000
6/1	100,000
9/1	400,000

To finance construction of the building a $600,000, 10% construction loan was taken out on March 1. The loan was repaid on September 1. The firm had $400,000 of other outstanding debt during the year at a borrowing rate of 12%.

Required:

Record the acquisition (journal entry) for each of these assets. Note: for Asset 6, no need to record a journal entry, just record the land and building acquisition cost as of September 1.