Question
Crane Limited exchanged equipment that it uses in its manufacturing operations for similar equipment that is used in the operations of Blue Limited. Crane also
Crane Limited exchanged equipment that it uses in its manufacturing operations for similar equipment that is used in the operations of Blue Limited. Crane also paid Blue $2,700 in cash. The following information pertains to the exchange.
| Crane | Blue | |||||
|---|---|---|---|---|---|---|
| Equipment (cost) | $59,000 | $64,000 | ||||
| Accumulated depreciation | 30,750 | 21,000 | ||||
| Fair value of equipment | 30,000 | 32,700 | ||||
Prepare the journal entries to record the exchange on the books of both companies, assuming the exchange is determined not to have commercial substance
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Cornerstones Of Cost Management
Authors: Don R. Hansen, Maryanne M. Mowen
3rd Edition
9781305147102, 1285751787, 1305147103, 978-1285751788
