Question
King Corp. traded an old machine with book value of $60,000 (cost $110,000 less accumulated depreciation $50,000) and a fair value of $100,000. King received
King Corp. traded an old machine with book value of $60,000 (cost $110,000 less accumulated depreciation $50,000) and a fair value of $100,000. King received a machine with a fair value of $90,000 plus cash of $10,000.
1) Prepare a journal entry, assuming commercial substance.
2) Prepare a journal entry, assuming NO commercial substance.
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Solution 1 Journal Entry with Commercial Substance King Corp traded an old machine with a book value ...
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Advanced Accounting
Authors: Gail Fayerman
1st Canadian Edition
9781118774113, 1118774116, 111803791X, 978-1118037911
