On the first day of the fiscal year, a delivery truck with a list price of $90,000 was acquired in exchange for an old delivery truck and $74,500 cash. The old truck had a cost of $60,000 and accumulated depreciation of $42,000. a. Determine the cost of the new truck for financial reporting purposes. b. Journalize the entry to record the exchange.

College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter18: Accounting For Long-term Assets
Section: Chapter Questions
Problem 5CE: Prepare journal entries for the following transactions: a. A machine with a cost of 10,000 and...
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Financial Accounting

On the first day of the fiscal year, a delivery truck with a list price
of $90,000 was acquired in exchange for an old delivery truck
and $74,500 cash. The old truck had a cost of $60,000 and accumulated
depreciation of $42,000.
a. Determine the cost of the new truck for financial reporting purposes.
b. Journalize the entry to record the exchange.
Transcribed Image Text:On the first day of the fiscal year, a delivery truck with a list price of $90,000 was acquired in exchange for an old delivery truck and $74,500 cash. The old truck had a cost of $60,000 and accumulated depreciation of $42,000. a. Determine the cost of the new truck for financial reporting purposes. b. Journalize the entry to record the exchange.
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