Busytown Corporation, which manufactures shoes, hired a recent college graduate to work in its accounting department. On the first day of work, the accountant was assigned to total a batch of invoices with the use of an adding machine. Before long, the accountant, who had never before seen such a machine, managed to break the machine. Busytown Corporation gave the machine plus $340 to Dick Tracy Business Machine Company (dealer) in exchange for a new machine. Assume the following information about the machines. Busytown Corp. (Old Machine) Dick Tracy Co. (New Machine) Machine cost 000 $290000 000 $270000 Accumulated depreciation 000 140000 000 –0–000 Fair value 000 85000 000 425000 Instructions For each company, prepare the necessary journal entry to record the exchange. (The exchange has commercial su
Busytown Corporation, which manufactures shoes, hired a recent college graduate to work in its accounting department. On the first day of work, the accountant was assigned to total a batch of invoices with the use of an adding machine. Before long, the accountant, who had never before seen such a machine, managed to break the machine. Busytown Corporation gave the machine plus $340 to Dick Tracy Business Machine Company (dealer) in exchange for a new machine. Assume the following information about the machines. Busytown Corp. (Old Machine) Dick Tracy Co. (New Machine) Machine cost 000 $290000 000 $270000 Accumulated depreciation 000 140000 000 –0–000 Fair value 000 85000 000 425000 Instructions For each company, prepare the necessary journal entry to record the exchange. (The exchange has commercial su
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Busytown Corporation, which manufactures shoes, hired a recent college graduate to work in its accounting department. On the first day of work, the accountant was assigned to total a batch of invoices with the use of an adding machine. Before long, the accountant, who had never before seen such a machine, managed to break the machine. Busytown Corporation gave the machine plus $340 to Dick Tracy Business Machine Company (dealer) in exchange for a new machine. Assume the following information about the machines.
|
|
Busytown Corp. (Old Machine) |
|
Dick Tracy Co. (New Machine) |
|
| Machine cost |
000
|
$290000
|
000
|
$270000
|
|
000
|
140000
|
000
|
–0–000
|
|
| Fair value |
000
|
85000
|
000
|
425000
|
Instructions
For each company, prepare the necessary
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