Question
The Tinsley Company exchanged land that it had been holding for future plant expansion for a more suitable parcel located farther from residential areas. Tinsley
The Tinsley Company exchanged land that it had been holding for future plant expansion for a more suitable parcel located farther from residential areas. Tinsley carried the land at its original cost of $100,000. According to an independent appraisal, the land currently is worth $240,000. Tinsley paid $33,000 in cash to complete the transaction.
4. Prepare the journal entry to record the exchange except that Tinsley received $48,000 in the exchange, and the exchange lacks commercial substance.
| No | Transaction | General Journal | Debit | Credit |
|---|---|---|---|---|
| 1 | 1 | Land - new | ||
| Cash | ||||
| Land - old | ||||
| Gain on exchange of assets |
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Accounting
Authors: John Hoggett, John Medlin, Lew Edwards, Matthew Tilling, Evelyn Hoggett Hogg
6th Edition
1742466354, 978-1742466354
