(Nonmonetary Exchange) Stacey Limited exchanged equipment that it uses in its manufacturing operations for similar equipment that is used in the operations of Chokar Limited. Stacey also paid Chokar $3,000 in cash. The following information pertains to the exchange: Stacey Chokar Equipment (cost)   $50,000    $55,000 Accumulated depreciation  31,250  22,000 Fair value of equipment  25,000  28,000 Instructions 

a. Prepare the journal entries to record the exchange on the books of both companies, assuming the exchange is determined to have commercial substance. 

b. Repeat part (a), assuming the exchange is determined not to have commercial substance. 

c. List some of the factors that the accountant would need to consider in order to determine whether the transaction has commercial substance.