On August 1, 2020 the Jones Corporation acquired a new equipment to be used in its production process. Jones exchanged an existing asset that had an original cost of $60,000 and accumulated depreciation of $40,000. The fair value of the old equipment is $17,000. In addition, Jones paid $40,000 cash to the equipment manufacturer to acquire the new equipment.

Prepare the journal entry to record the exchange transaction assuming that the transaction does have commercial substance. Clearly label and show all of your work.