Handling a swap

If you have stck on your book $100,000 and you acquire an asset
(building) 1,000,000.
Building 1,000,000
Investment 100,000
What happens to the other 900,000?
Reply to
Assuming you don't know the fair value of the stock but you know the fair value of the building, you would record a credit entry of $900K for paid-in capital. Also, you should reword the "investment" entry to "common stock."
Reply to
"kuhrty" wrote
You're going to have a gain on the sale of the stock (receiving a building instead of cash).
There may be other items to be accounted for, like if there is a mortgage on the building, etc.
More facts are needed before you can get the full picture of how the booking entries are to be made.
Reply to
Paul Thomas, CPA

Site Timeline Threads

BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.