Nonmonetary exchange.

Beeman Company exchanged machinery with an appraised value of $3,510,000, a recorded cost of $5,400,000 and accumulated depreciation of $2,700,000 with Lacey Corporation for machinery Lacey owns. The machinery has an appraised value of $3,390,000, a recorded cost of $6,480,000, and accumulated depreciation of $3,564,000. Lacey also gave Beeman $120,000 in the exchange. Assume depreciation has already been updated.

(a) Prepare the entries on both companies' books assuming that the exchange had commercial substance. (Round all computations to the nearest dollar.)

(b) Prepare the entries on both companies' books assuming that the exchange lacked commercial substance. (Round all computations to the nearest dollar.)