Please respond to the following:

Imagine you are the accounting managerfor a manufacturing company's fixed assets department. The CFO is assessing the benefits of acquiring a new John Deere Tractor and Elite Combine and disposing of similarused equipment. The CFO has asked you to do the following:

• Explain the effect of each transaction on the financial statements.
• Explain how the substance and asset and/or monetary exchange affects the reporting of the transaction and the financial statements.

"Self Constructed Assets"

• Imagine you are the senior accountant in the fixed assets department of your organization. Management is assessing the benefits of self-constructing fixed assets versus purchasing fixed assets from external sources. Differences of opinion exist among the senior management team on the impact of self-constructing fixed assets versus purchasing fixed assets on the balance sheet, income statement, statement of cash flows, and employee morale. You are asked to provide a presentation to the senior management team highlighting the accounting advantages and disadvantages of constructing versus purchasing assets. Select a position on constructing the asset or purchasing the asset. Defend your position.