I think the second part of question C is meant to say What if it has commercial substance, how would it impact the financial statement?

Company A Company B Original Cost of Machinery Accumulated Depreciation Fair Value $150,000 80,000 120,000 $100.000 45,000 80,000 Company A is trading machinery with Company B. a) Prepare journal entries to record the exchange on the books of both companies. Assume the exchange lacks commercial substance. b) Prepare journal entries to record the exchange on the books of both companies. Assume the exchange has commercial substance. c) If the exchanged lacked commercial substance how would it impact the financial statement? What if it has commercial substance