Question
Ayayai Company exchanged equipment used in its manufacturing operations plus $4,200 in cash for similar equipment used in the operations of Pina Company. The following
Ayayai Company exchanged equipment used in its manufacturing operations plus $4,200 in cash for similar equipment used in the operations of Pina Company. The following information pertains to the exchange.
| Ayayai Co. | Pina Co. | |||||
| Equipment (cost) | $39,200 | $39,200 | ||||
| Accumulated depreciation | 26,600 | 14,000 | ||||
| Fair value of equipment | 17,500 | 21,700 | ||||
| Cash given up | 4,200 |
| ||||
Prepare the journal entries to record the exchange on the books of both companies. Assume that the exchange has commercial substance.
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Intermediate Accounting
Authors: Donald E. Kieso, Jerry J. Weygandt, And Terry D. Warfield
13th Edition
9780470374948, 470423684, 470374942, 978-0470423684
