Pratt Freight is a large warehousing and distribution company that operates throughout Eastern Canada Pratt Freight uses the UOP method to amortize its trucks because its managers believe UOP amortization best measures the wear and tear on the trucks Pratt Freight trades in used trucks often to keep driver morale high and to maximize fuel efficiency. Consider these facts about one Mack truck in the company's fleet When acquired in 2016, the tractor/trailer rig cost $640,000 and was expected to remain in service for eight years, or 1,800,000 kilometres. Estimated residual value was $75,000. The truck was driven 180,000 kilometres in 2017, 205,000 kilometres in 2018, and 235,000 kilometres in 2019. After 130,000 kilometres in 2020, the company traded in the Mack truck for a Freightliner rig with a fair market value of $500,000 on August 15. Pratt Freight paid cash of $50,000. This trade-in will bring in significantly more income to Pratt Freight by reducing operating costs. Determine Pratt Freight's cost of the new truck. Prepare the journal entry to record the trade-in Determine Pratt Freight's cost of the new truck. Pratt Freight's cost of the new truck is the market value Record the journal entry for the trade-in (Record debits first, then credits. Exclude explanations from journal entries. Do not round intermediary calculations. Only round the final answer to the nearest dollar.) Journal Entry Date Accounts Debit Credit Aug 15 New Truck 500,000 Old Truck 340,000 Cash 50,000 Gain on Exchange of Trucks