Pester Company transferred the following assets to a newly created subsidiary, Shumby Corpora- tion, in exchange for 50,000 shares of its $4 par value stock: Required: a- Give the journal entry in which Pester recorded the transfer of assets to Shumby Corporation. (Show all calculations) b- Give the journal entry in which Shumby recorded the receipt of assets adn issuance of common stock to Pester. (Show all calculations) .

1. Pester Company transferred the following assets to a newly created subsidiary, Shumby Corpora-
tion, in exchange for 50,000 shares of its $4 par value stock:
Required:
a- Give the journal entry in which Pester recorded the transfer of assets to Shumby Corporation.
(Show all calculations)
b- Give the journal entry in which Shumby recorded the receipt of assets adn issuance of
common stock to Pester. (Show all calculations)
Assets Cost Book value
Cash $40,000 $40,000
Accounts Receivable 75,000 68,000
Inventory 50,000 50,000
Land 35,000 35,000
Buildings 160,000 130,000
Equipment 240,000 180,000