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On January 2, 2023, Direct Shoes Inc. disposed of a machine that cost $94, 000 and had been depreciated $50, 250. Present the journal entries to record the disposal under each of the following unrelated assumptions: a. The machine was sold for $42, 500 cash. Record the sale of machine. b. The machine was traded in on new tools having a $137,000 cash price. A $ 50,000 trade - in allowance was received, and the balance was paid in cash. Since the tools have been customized, the fair values are not known.Record the exchange of machine. c. The machine plus $78,000 was exchanged for a delivery van having a fair value of $114,000. Record the exchange of machine. d. The machine was traded for vacant land adjacent to the shop to be used as a parking lot. The land had a fair value of $85,000, and Direct Shoes Inc. paid $35,000 cash in addition to giving the seller the machine.Record the exchange of machine.

On January 2, 2023, Direct Shoes Inc. disposed of a machine that cost $94, 000 and had been depreciated $50, 250. Present the journal entries to record the disposal under each of the following unrelated assumptions: a. The machine was sold for $42, 500 cash. Record the sale of machine. b. The machine was traded in on new tools having a $137,000 cash price. A $ 50,000 trade - in allowance was received, and the balance was paid in cash. Since the tools have been customized, the fair values are not known.Record the exchange of machine. c. The machine plus $78,000 was exchanged for a delivery van having a fair value of $114,000. Record the exchange of machine. d. The machine was traded for vacant land adjacent to the shop to be used as a parking lot. The land had a fair value of $85,000, and Direct Shoes Inc. paid $35,000 cash in addition to giving the seller the machine.Record the exchange of machine.

FINANCIAL ACCOUNTING
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 January 2, 2023, Direct Shoes Inc. disposed of a machine that cost $94, 000 and had been depreciated $50, 250. Present the journal entries to record the disposal under each of the following unrelated assumptions: a. The machine was sold for $42, 500 cash. Record the sale of machine. b. The machine was traded in on new tools having a $137,000 cash price. A $ 50,000 trade - in allowance was received, and the balance was paid in cash. Since the tools have been customized, the fair values are not known.Record the exchange of machine. c. The machine plus $78,000 was exchanged for a delivery van having a fair value of $114,000. Record the exchange of machine. d. The machine was traded for vacant land adjacent to the shop to be used as a parking lot. The land had a fair value of $85,000, and Direct Shoes Inc. paid $35,000 cash in addition to giving the seller the machine. Record the exchange of machine.
Transcribed Image Text:On January 2, 2023, Direct Shoes Inc. disposed of a machine that cost $94, 000 and had been depreciated $50, 250. Present the journal entries to record the disposal under each of the following unrelated assumptions: a. The machine was sold for $42, 500 cash. Record the sale of machine. b. The machine was traded in on new tools having a $137,000 cash price. A $ 50,000 trade - in allowance was received, and the balance was paid in cash. Since the tools have been customized, the fair values are not known.Record the exchange of machine. c. The machine plus $78,000 was exchanged for a delivery van having a fair value of $114,000. Record the exchange of machine. d. The machine was traded for vacant land adjacent to the shop to be used as a parking lot. The land had a fair value of $85,000, and Direct Shoes Inc. paid $35,000 cash in addition to giving the seller the machine. Record the exchange of machine.
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