Grover Petroleum owns a piece of equipment, originally costing $60,000, that is currently being used on Lease A. Grover Petroleum owns a 40% working interest in Lease A and serves as the operator of the lease. The company plans to use the equipment on a lease wholly owned by Grover Petroleum. The equipment is transferred to the company’s warehouse.

Required: Prepare the entry to record the transfer under each of the following independent situations:

a. The equipment is in Condition B and originally was Condition A when transferred to the property. The current market price is $80,000.

b. The equipment is in Condition C, and Grover Petroleum will pay for the reconditioning. The current market price is $80,000.