Question 1 (50 points) Flower Company was established on January 1, 2015. Along with other...
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Question 1 (50 points) Flower Company was established on January 1, 2015. Along with other assets, it immediately purchased land for $120,000, and a building $210,000. On January 1, 2020, Flower transferred these assets, cash of $30,000, and inventory costing $35,000 to a newly created subsidiary, Sparrow Company, in exchange for 27,000 shares of Sparrow's $4 par value stock. Flower uses straight-line depreciation and useful life of 30 years for the building, with no estimated residual values. Required: a. Give the journal entry that Flower recorded for the transfer of assets and liabilities to Sparrow (25 points) b. Give the journal entry that Sparrow recorded for the receipt of assets and liabilities from Flower (25 points)
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