Goodman Company acquired a truck from Harmes Company in exchange for a machine. The exchange is determined to have commercial substance. The machine cost $30,000, has a book value of $6,000, and has a market value of $8,500. The truck has a cost of $12,000 and a book value of $8,000 on Harmes books.

Goodman agrees to pay $500 to complete the exchange.

Required:

Prepare journal entries for Goodman and Harmes to record the exchange.

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GENERAL JOURNAL

Score: 121/125

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