Busytown Corporation, which manufactures shoes, hired a recent college graduate to work in its accounting department. On the first day of work, the accountant was assigned to total a batch of invoices with the use of an adding machine. Before long, the accountant, who had never before seen such a machine, managed to break machine. Busytown Corporation gave the machine plus $340 to Tracy Business Machine Company (dealer) in exchange for a new machine.

Assume the following information about machines.

	Busytown Corp. (Old Machine)	Tracy Co. (New Machine)
Machine cost	290	270
Accumulated depreciation	140	0
Fair value	85	425

INSTURCTIONS

For each company, prepare the necessary journal entry to record the exhange