Question
Two independent companies, Denver and Bristol, each own a warehouse, and they agree to an exchange in which no cash changes hands. The following information
Two independent companies, Denver and Bristol, each own a warehouse, and they agree to an exchange in which no cash changes hands. The following information for the two warehouses is available: Denver Bristol Cost $80,000 $31,500 Accumulated depreciation 60,000 25,000 Fair value 17,000 17,000
Required: 1. Assuming the exchange has commercial substance, prepare journal entries for Denver and Bristol to record the exchange.
2. Assuming the exchange does not have commercial substance, prepare journal entries for Denver and Bristol to record the exchange.
1. Assume the exchange has commercial substance and occurred on April 1. Prepare journal entries for Denver and Bristol to record the exchange.
GENERAL JOURNAL
| DATE | ACCOUNT TITLE | POST. REF. | DEBIT | CREDIT | |
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2. Assume the exchange does not have commercial substance and occurred on April 1. Prepare journal entries for Denver and Bristol to record the exchange.
GENERAL JOURNAL
| DATE | ACCOUNT TITLE | POST. REF. | DEBIT | CREDIT | |
|---|---|---|---|---|---|
| 1 |
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| 2 |
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Financial And Managerial Accounting Information For Decisions
Authors: John Wild, Ken Shaw, Barbara Chiappetta
7th Edition
1259726703, 9781259726705
