The production manager of Clayton Corporation wants to acquire a different brand of machine by exchanging the machine that it currently uses in operations for the brand of equipment that others in the industry are using. The brand being used by other companies is more comfortable for the operators because it has different attachments that allow the operators to adjust the controls for a variety of arm and hand positions. The production manager has received the following offers from other companies:

1.		Camrose Corp. offered to give Clayton a similar machine plus $13,800 in exchange for Claytons machine.
2.		J&J Corp. offered a straight exchange for a similar machine with essentially the same value in use.
3.		DNG Corp. offered to exchange a similar machine with the same value in use, but wanted $4,800 cash in addition to Clayton's machine.
4.		The production manager has also contacted ABC Corporation, a dealer in machines. To obtain a new machine from ABC, Clayton would have to pay $55,800 and also trade in its old machine.

Claytons machinery has a cost of $96,000, a net book value of $66,000, and a fair value of $55,200. The following table shows the information needed to record the machine exchange between the companies:

For each of the four independent situations, assume that Bramble accepts the offer. Prepare the journal entries to record the exchange on the books of each company. Assume that transactions 2 and 3 lack commercial substance for J&J Company and DNG Company respectively .

TRANSACTION 1

CLAYTON CORP.

CAMROSE CORP.

TRANSACTION 2

CLAYTON CORP.

J&J CORP.

Transaction 3:

CLAYTON CORP.

DNG CO.

Transaction 4:

CLAYTON CORP

ABC CORP.

HERE ARE THE SAMPLE LIST OF ACCOUNTS BELOW AS REFERENCE ON JOURNAL ENTRIES:

Accounts Payable Accounts Receivable Accumulated Depreciation - Buildings Accumulated Depreciation - Equipment Accumulated Depreciation - Leasehold Improvements Accumulated Depreciation - Machinery Accumulated Depreciation - Trucks Advertising Expense Asset Retirement Obligation Buildings Cash Common Shares Contributed Surplus Cost of Goods Sold Deferred Revenue - Government Grants Depreciation Expense Donation Revenue Equipment Finance Expense Finance Revenue Gain in Value of Investment Property Gain on Disposal of Building Gain on Disposal of Equipment Gain on Disposal of Machinery Gain on Disposal of Truck Gain on Sale of Land GST Payable GST Receivable Interest Expense Interest Income Interest Payable Interest Receivable Inventory Investment Property Land Land Improvements Loss in Value of Investment Property Loss on Disposal of Building Loss on Disposal of Equipment Loss on Disposal of Land Loss on Disposal of Machinery Loss on Disposal of Truck Machinery Maintenance and Repairs Expense Mineral Resources Mortgage Payable No Entry Notes Payable Notes Receivable Office Expense Owner's Drawings Prepaid Expenses Prepaid Insurance Profit on Construction Purchase Discounts Purchase Returns and Allowances Rent Expense Revaluation Gain or Loss Revaluation Surplus (OCI) Revenue - Government Grants Salaries and Wages Expense Salaries and Wages Payable Sales Revenue Service Revenue Supplies Supplies Expense Tenant Deposits Liability Trucks

Secord Bateman Shripad Ansong $72,000 $88,200 $96,000 $78,000 Machine cost Accumulated depreciation-machinery 27,000 42,600 45,000 Fair value 41,40055,200 60,000 111,000 Secord Bateman Shripad Ansong $72,000 $88,200 $96,000 $78,000 Machine cost Accumulated depreciation-machinery 27,000 42,600 45,000 Fair value 41,40055,200 60,000 111,000