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On July 1, 2021, JULIA exchanged its non-monetary asset (equipment) with GERALD’s non-monetary asset (machinery). The following data were made available:     JULIA:  Equipment                                           P4,400,000  Accumulated depreciation                  2,000,000  Cash received from Gerald                     500,000     GERALD:  Machinery                                           P3,700,000  Accumulated depreciation                  1,800,000  Cash paid to Julia                                    500,000     The transaction lacks commercial substance.     How much is cost of the new asset of JULIA?

On July 1, 2021, JULIA exchanged its non-monetary asset (equipment) with GERALD’s non-monetary asset (machinery). The following data were made available:     JULIA:  Equipment                                           P4,400,000  Accumulated depreciation                  2,000,000  Cash received from Gerald                     500,000     GERALD:  Machinery                                           P3,700,000  Accumulated depreciation                  1,800,000  Cash paid to Julia                                    500,000     The transaction lacks commercial substance.     How much is cost of the new asset of JULIA?

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 July 1, 2021, JULIA exchanged its non-monetary asset (equipment) with GERALD’s non-monetary asset (machinery). The following data were made available: 

  

JULIA: 

Equipment                                           P4,400,000 

Accumulated depreciation                  2,000,000 

Cash received from Gerald                     500,000 

  

GERALD: 

Machinery                                           P3,700,000 

Accumulated depreciation                  1,800,000 

Cash paid to Julia                                    500,000 

  

The transaction lacks commercial substance. 

  

How much is cost of the new asset of JULIA? 

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