*E9-15B Presented below are two independent transactions. Both transactions have commercial substance. 1. Rees Co. exchanged old trucks (cost $74,000 less $42,000 accumulated depreciation) plus cash of $29,000 for new trucks. The old trucks had a fair value of $25,000. 2. Keller Inc. trades its used machine (cost $20,000 less $14,000 accumulated depreciation) for a new machine. In addition to exchanging the old machine (which had a fair value of $8,000), Keller also paid cash of $17,000. Instructions (a) Prepare the entry to record the exchange of assets by Rees Co. (b) Prepare the entry to record the exchange of assets by Keller Inc.

*E9-15B Presented below are two independent transactions. Both transactions have commercial substance. 1. Rees Co. exchanged old trucks (cost $74,000 less $42,000 accumulated depreciation) plus cash of $29,000 for new trucks. The old trucks had a fair value of $25,000. 2. Keller Inc. trades its used machine (cost $20,000 less $14,000 accumulated depreciation) for a new machine. In addition to exchanging the old machine (which had a fair value of $8,000), Keller also paid cash of $17,000. Instructions (a) Prepare the entry to record the exchange of assets by Rees Co. (b) Prepare the entry to record the exchange of assets by Keller Inc.

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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