Question
Carlos Arruza Company exchanged equipment used in its manufacturing operations plus $3,000 in cash for similar equipment used in the operations of Tony LoBianco Company.
Carlos Arruza Company exchanged equipment used in its manufacturing operations plus $3,000 in cash for similar equipment used in the operations of Tony LoBianco Company. The following information pertains to the exchange.
Carlos Arruza Co. Tony LoBianco Co.
Equipment (cost) $28,000 $28,000
Accumulated depreciation 19,000 10,000
Fair value of equipment 12,500 15,500
Cash given up 3,000
a) Prepare the journal entries to record the exchange on the books of both companies. Assume that the exchange lacks commercial substance.
b) 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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Audit Committee Formation In The Aftermath Of 2007 2009 Global Financial Crisis Structure And Roles Volume 1 Financial Accounting And Auditing Collection
Authors: Zabihollah Rezaee
1st Edition
1631571567, 978-1631571565
