Southern Company owns a building that it leases to others. The buildings fair value is $1,550,000 and its book value is $920,000 (original cost of $2,150,000 less accumulated depreciation of $1,230,000). Southern exchanges this for a building owned by the Eastern Company. The buildings book value on Easterns books is $1,070,000 (original cost of $1,750,000 less accumulated depreciation of $680,000). Eastern also gives Southern $155,000 to complete the exchange. The exchange has commercial substance for both companies.

Required:

Prepare the journal entries to record the exchange on the books of both Southern and Eastern