During the current year, Bridgeport Construction Ltd. traded in two relatively new small cranes (cranes no. 6RT and S79) for a larger crane that Bridgeport expects will be more useful for the particular contracts that the company has to fulfill over the next couple of years. The new crane is acquired from Sarasota Manufacturing Inc., which has agreed to take the smaller equipment as trade-ins and also pay $13,000 cash to Bridgeport. The new crane cost Sarasota $173,000 to manufacture and is classified as inventory. The following information is available:

----------------------------------------------------------------------------------Bridgeport Const.----------------------------------------------------Sarasota Mfg

Cost of crane #6RT

$122,000

Cost of crane #S79

117,500

Accumulated depreciation, #6RT

12,000

Accumulated depreciation, #S79

15,000

Fair value, #6RT

125,000

Fair value, #S79

86,000

Fair value of new crane

$198,000

Cash paid

13,000

Cash received

Assume that this exchange has commercial substance. Prepare the journal entries on the books of (1) Bridgeport Construction Ltd. and (2) Sarasota Manufacturing Inc. Sarasota uses a perpetual inventory system. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Bridgeport Construction

Account Titles and Explanation

Debit

Credit

----------------------------------

-----------------------------------

----------------------------------

--------------------------------

--------------------------------

------------------------------

-------------------------------

Sarasota Manufacturing

Account Titles and Explanation

Debit

Credit

_______________________

_________________________

_________________________-

(To record equipment purchase)

_________________________

_________________________

(To record the cost)

Assume that this exchange lacks commercial substance. Prepare the journal entries on the books of (1) Bridgeport Construction and (2) Sarasota Manufacturing. Sarasota uses a perpetual inventory system. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Bridgeport Construction

Account Titles and Explanation

Debit

Credit

_________________________

__________________________

___________________________

________________________-

__________________________

___________________________

___________________________

Sarasota Manufacturing

Account Titles and Explanation

Debit

Credit

______________________

_______________________

________________________