Question
Can I gert some help Reporting an Asset Exchange Clarksten Co. and Kay Inc. exchange equipment. Information related to this exchange for both companies follows.
Can I gert some help
Reporting an Asset Exchange
Clarksten Co. and Kay Inc. exchange equipment. Information related to this exchange for both companies follows.
| Clarksten Co. | Kay Inc. | |
|---|---|---|
| Equipment given up: | ||
| Equipment (original cost) | $60,000 | $70,000 |
| Accumulated depreciation | 20,000 | 24,000 |
| Fair value | 36,000 | 48,000 |
| Cash exchanged | (12,000) | 12,000 |
Answer the following questions, rounding your answers to the nearest whole number. a. Record the exchange for Clarksten Co. assuming the transaction has commercial substance. b. Record the exchange for Kay Inc. assuming the transaction has commercial substance. c. Record the exchange for Clarksten Co. assuming the transaction lacks commercial substance. d. Record the exchange for Kay Inc. assuming the transaction lacks commercial substance.
Note: If a line in a journal entry isn't required for a transaction, select "N/A" as the account name and leave the Dr. and Cr. answers blank (zero)
- Exchange has commercial substance
- Exchange lacks commercial substance
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The Auditor Quo Vadis
Authors: Mervyn King, Linda De Beer
1st Edition
1138496774, 978-1138496774
