Asset exchange with commercial substanceln 2015, Malawi Inc. exchanged equipment for two delivery trucks. The equipment had beenpurchased for $95,000 ten years ago and has since been fully depreciated. While the equipmentwas recently appraised at $22,000, a reliable valuation for the trucks was not available. Thistransaction has commercial substance.InstructionsPrepare the journal entry to record the exchange.

Asset exchange with commercial substanceln 2015, Malawi Inc. exchanged equipment for two delivery trucks. The equipment had beenpurchased for $95,000 ten years ago and has since been fully depreciated. While the equipmentwas recently appraised at $22,000, a reliable valuation for the trucks was not available. Thistransaction has commercial substance.InstructionsPrepare the journal entry to record the exchange.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On September 30, 2014, Leeds LTD, acquired a potent in conjunction with the purchase of another company. The potent, valued at $6 million, was estimated to have a 10-year life and no residual value. Leeds user the straight-line method of amortization for intangible assets. At the beginning of January 2016, Leeds successfully defended its patent against infringement. Litigation costs totaled $500,000. Requireal: 1. Calculate amortization of the potent for 2014 and 2015. 2. Prepare the journal entry to record the 2016 litigation costs. 3. Calculate amortization for 2016. Repeat requirements 2 and 3 assuming that Leeds prepares its financial statements according to IFRS.
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Pearl’s Delivery Company and Martinez’s Express Delivery exchanged delivery trucks on January 1, 2020. Pearl’s truck cost €22,500. It has accumulated depreciation of €15,500 and a fair value of €3,300. Martinez’s truck cost €8,500. It has accumulated depreciation of €6,800 and a fair value of €3,300. The transaction has commercial substance. Journalize the exchange for Pearl’s Delivery Company Account Titles and Explanation Debit Credit Equipment Accumulated Depreciation-Equipment Loss on Disposal of Plant Assets Equipment please make sure the answer is correct 100%
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On August 1, Crane, Inc. exchanged productive assets with Cheyenne, Inc. Crane’s asset is referred to below as “Asset A,” and Cheyenne’ is referred to as “Asset B.” The following facts pertain to these assets. Asset A Asset B Original cost $117,120 $134,200 Accumulated depreciation (to date of exchange) 48,800 57,340 Fair value at date of exchange 73,200 91,500 Cash paid by Crane, Inc. 18,300 Cash received by Cheyenne, Inc. 18,300 Assuming that the exchange of Assets A and B lacks commercial substance, record the exchange for both Crane, Inc. and Cheyenne, Inc. in accordance with generally accepted accounting principles. Account Titles and Explanation Debit Credit Crane, Inc.’s Books Cheyenne, Inc.’s Books
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