Tom Inc. exchanged productive assets (machinery) with Jerry, Inc. on July 1, 2020. Before the exchange, both companies use straight-line depreciation on the machineries. The transaction lacks commercial substance. The following facts pertain to the assets of the two companies:

	Tom's Old Asset		Jerry's Old Asset
Original Cost	110,000		96,000
Accumulated Depreciation (as of December 31, 2019)	41,000		35,000
Annual Depreciation	12,000		10,000
Fair Value at Date of Exchange	75,000		60,000

Instructions: Prepare the journal entries for both Tom and Jerry. Show work to earn partial credits.

(Hint: should cash be involved in this transaction?)