INTERMEDIATE ACCOUNTING
3rd Edition
ISBN: 9780136946694
Author: GORDON
Publisher: RENT PEARS
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Chapter 11, Problem 11.34E
To determine
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Peanut Corporation exchanged land and cash of $6,500 for equipment. The land had a book value of $45,000 and a fair value of $34,000. Assume the exchange has commercial substance.Required:Prepare the journal entry to record the exchange.
C Inc. and D Co. have an exchange with no commercial substance. The asset given up by C Inc. has a book value of P12,000. The asset given up by D Co. has a book value of P20,000. Cash of P4,000 is received by D Co. What amount should C Inc. record for the asset received?
Kerry, Inc., exchanged land and cash of $7,700 for equipment. The land had a book value of $52,000 and a fair value of $56.700.
Required:
Prepare the journal entry to record the exchange. Assume the exchange has commercial substance. (If no entry is required for a
transaction/event, select "No journal entry required" in the first account field.)
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Journal entry worksheet
Record the exchange of assets.
Hole: Enter debits befere ti diis.
Tránsaction
General Journal
Debit
Credit
Chapter 11 Solutions
INTERMEDIATE ACCOUNTING
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Ch. 11 - Prob. 11.11QCh. 11 - What is the maximum amount of interest to be...Ch. 11 - Prob. 11.13QCh. 11 - Prob. 11.14QCh. 11 - Prob. 11.15QCh. 11 - Do firms expense all costs incurred after the...Ch. 11 - Prob. 11.17QCh. 11 - Prob. 11.18QCh. 11 - When using the double-declining balance...Ch. 11 - Prob. 11.20QCh. 11 - Will a firm recognize a loss on the income...Ch. 11 - Prob. 11.22QCh. 11 - Prob. 11.23QCh. 11 - Prob. 11.24QCh. 11 - Prob. 11.25QCh. 11 - Differentiate between a leasehold and a leasehold...Ch. 11 - Prob. 11.27QCh. 11 - Prob. 11.28QCh. 11 - Prob. 11.29QCh. 11 - Prob. 11.30QCh. 11 - Prob. 11.31QCh. 11 - Prob. 11.32QCh. 11 - Prob. 11.33QCh. 11 - Prob. 11.34QCh. 11 - Prob. 11.35QCh. 11 - Prob. 11.36QCh. 11 - Prob. 11.37QCh. 11 - Prob. 11.38QCh. 11 - Prob. 11.39QCh. 11 - Prob. 11.40QCh. 11 - In a nonmonetary exchange does a firm record the...Ch. 11 - Prob. 11.42QCh. 11 - Prob. 11.43QCh. 11 - Prob. 11.44QCh. 11 - Prob. 11.45QCh. 11 - Prob. 11.1MCCh. 11 - On January 1, Year 1, Bluebird Inc. borrowed 10...Ch. 11 - Prob. 11.3MCCh. 11 - Prob. 11.4MCCh. 11 - Prob. 11.5MCCh. 11 - Prob. 11.6MCCh. 11 - Prob. 11.7MCCh. 11 - Prob. 11.8MCCh. 11 - Determining Acquisition Cost. Haply, Inc. incurred...Ch. 11 - Determining Acquisition Cost. Tarpley, Inc....Ch. 11 - Prob. 11.3BECh. 11 - Prob. 11.4BECh. 11 - Prob. 11.5BECh. 11 - Prob. 11.6BECh. 11 - Prob. 11.7BECh. 11 - Prob. 11.8BECh. 11 - Depreciation, Straight-Line Method. Hermit...Ch. 11 - Prob. 11.10BECh. 11 - Prob. 11.11BECh. 11 - Prob. 11.12BECh. 11 - Prob. 11.13BECh. 11 - Derecognition Due to Abandonment. Greene Corp....Ch. 11 - Prob. 11.15BECh. 11 - Prob. 11.16BECh. 11 - Prob. 11.17BECh. 11 - Prob. 11.18BECh. 11 - Prob. 11.19BECh. 11 - Prob. 11.20BECh. 11 - Leasehold Improvements. At the beginning of its...Ch. 11 - Determining Acquisition Cost. St Charles Flooring...Ch. 11 - Prob. 11.2ECh. 11 - Prob. 11.3ECh. 11 - Acquiring an Asset with a Note Payable (Deferred...Ch. 11 - Prob. 11.5ECh. 11 - Prob. 11.6ECh. 11 - Capitalization of Interest, Specific and General...Ch. 11 - Prob. 11.8ECh. 11 - Prob. 11.9ECh. 11 - Capitalization of Interest, Specific and General...Ch. 11 - Prob. 11.11ECh. 11 - Expensing versus Capitalizing ExpendituresAnalysis...Ch. 11 - Depreciation Methods, Disposal. Kurtis Koal...Ch. 11 - Prob. 11.14ECh. 11 - Depreciation Methods, Partial-Year Depreciation....Ch. 11 - Prob. 11.16ECh. 11 - Depreciation Methods. Ace Manufacturing, Inc....Ch. 11 - Prob. 11.18ECh. 11 - Depreciation Methods, Partial-Year Depreciation,...Ch. 11 - Prob. 11.20ECh. 11 - Partial-Year Depreciation, Sale of Property,...Ch. 11 - Prob. 11.22ECh. 11 - Disclosure of Property, Plant, and Equipment. Use...Ch. 11 - Disclosure of Property, Plant, and Equipment,...Ch. 11 - Prob. 11.25ECh. 11 - Research and Development Activities. During the...Ch. 11 - Prob. 11.27ECh. 11 - Goodwill Computation, Acquisition of Intangibles,...Ch. 11 - Prob. 11.29ECh. 11 - Prob. 11.30ECh. 11 - Prob. 11.31ECh. 11 - Prob. 11.32ECh. 11 - Prob. 11.33ECh. 11 - Prob. 11.34ECh. 11 - Prob. 11.35ECh. 11 - Prob. 11.36ECh. 11 - Prob. 11.37ECh. 11 - Exchanges Lacking Commercial Substance, Cash...Ch. 11 - Prob. 11.39ECh. 11 - Prob. 11.40ECh. 11 - Prob. 11.41ECh. 11 - Prob. 11.42ECh. 11 - Note Payable Exchanged for a Plant Asset (Deferred...Ch. 11 - Prob. 11.2PCh. 11 - Prob. 11.3PCh. 11 - Depreciation Methods and Depreciation Schedules....Ch. 11 - Prob. 11.5PCh. 11 - Prob. 11.6PCh. 11 - Goodwill and Bargain Purchase Computations. The...Ch. 11 - Prob. 11.8PCh. 11 - Prob. 11.9PCh. 11 - Prob. 11.10PCh. 11 - Prob. 11.11PCh. 11 - Judgment Case 1: Property, Plant, and Equipment:...Ch. 11 - Prob. 2JCCh. 11 - Prob. 1FSCCh. 11 - Surfing the Standards Cases Surfing the Standards...Ch. 11 - Prob. 2SSCCh. 11 - Surfing the Standards Case 3: Involuntary...Ch. 11 - Prob. 4SSCCh. 11 - Prob. 5SSCCh. 11 - Prob. 1BCCCh. 11 - Prob. 2BCC
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- Bonnie Inc. and Clyde Company have an exchange with no commercial substance. The asset given up by Bonnie has a book value of $120,000 and a fair value of $135,000. The asset given up by Clyde has a book value of $220,000 and a fair value of $200,000. Boot (cash) of $65,000 is received by Clyde. What amount should Bonnie record for the asset received?arrow_forwardMonty Corp. exchanges old delivery equipment for new delivery equipment. The book value of the old delivery equipment is $37,200 (cost $67,200 less accumulated depreciation $30,000). Its fair value is $23,100, and cash of $6,000 is paid. Prepare the entry to record the exchange, assuming the transaction has commercial substance. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry isrequired,select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Creditarrow_forwardAlvarez and Reymond, both NGAs, exchanged their equipment. Relevant data is presented below Alvarez Reymond Carrying amount 85,000 130,000 Fair value 95,000 115,000 Cash paid by Alvarez to Reymond 15,000 How much is the initial measurement of the equipment received by Reymond if the exchange has a commercial substance? Refer to the previous question, how much is the gain (loss) recognized by Reymond?arrow_forward
- Gunther Co. and Central Perk Coffee House, Inc. have an exchange that lacks commercial substance. The following information is noted regarding the assets involved in the transaction: Gunther Co. Central Perk Coffee House, Inc. Book Value $720,000 $1,140,000 Fair Value 1,200,000 1,080,000 Cash Paid - 120,000 Cash Received 120,000 - What amount should Gunther Co. record for the asset received? a. $600,000 b. $648,000 c. $1,200,000 d. $1,080,000arrow_forwardNavajo Corporation traded a used truck (cost $20,000, accumulated depreciation $18,000) for a small computer with a fair value of $3,300. Navajo also paid $500 in the transaction. Prepare the journal entry to record the exchange. (The exchange has commercial substance.)arrow_forwardThe Bronco Corporation exchanged land for equipment. The land had a book value of $138,000 and a fair value of $186,000. Bronco pald the owner of the equipment $28,000 to complete the exchange whlch has commercial substance. Required: 1. What Is the falr value of the equipment? 2. Prepere the Journal entry to record the exchange. Answer Is complete but not entirely correct. Complete thls question by entering your answers In the tabs below. Required 1 Required 2 Prepare the journal entry to record the exchange. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No Transaction General Journal Debit Credit Equipment - new Land - new 1 214,000 138,000 Cash 28,000 Gain on exchange of assets 48,000arrow_forward
- Keach Company traded machinery with a book value of $285,000 and a fair value of $270,000. It received in exchange from Marlin Company a machine with a fair value of $300,000. Keach also paid cash of $30,000 in the exchange. Marlin's machine has a book value of $285,000. The transaction lacks commercial substance. What amount of gain or loss should Keach recognize on the exchange? O $30,000 gain $-0- $1.500 loss $15,000 lossarrow_forwardPart A: On November 1, Ellery Corp. purchased land by transferring $50,000 cash and a building to the other company. The building given up had an original cost of $2,000,000, a book value of $400,000, and a fair market value of $900,000. Prepare the journal entry Ellery should make to record the exchange of the building and cash for the land, assuming the exchange has commercial substance. Part B: If the above exchange were deemed to have non-commercial substance, by what amount should the “Land” account be debited? Date Account Debit Credit November 1, 2022arrow_forwardMarigold Corporation traded a used truck for a new truck. The used truck cost $25,000 and has accumulated depreciation of $21,250. The new truck is worth $43,750. Marigold also made a cash payment of $41,250. Prepare Marigold's entry to record the exchange. (The exchange has commercial substance.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)arrow_forward
- Dial Co. and Safeguard Inc. engage in an exchange of nonmonetary assets that LACKS commercial substance. Dial gives up an asset with a book value of $20,000 and a fair market value of $19,000. Safeguard gives up an asset with a book value of $12,000 and a fair market value of $15,000. Safeguard also paid $4,000 cash boot. What amount should SAFEGUARD record for the asset received and for the gain or loss? O $16,000 and $3,000 gain O $16,000 and $0 gain/loss O $15,000 and $0 gain/loss O $19,000 and $3,000 gainarrow_forwardThe Bronco Corporation exchanged land for equipment. The land had a book value of $136,000 and a fair value of $182,000. Bronco paid the owner of the equipment $26,000 to complete the exchange which has commercial substance. Required: 1. What is the fair value of the equipment? 2. Prepare the journal entry to record the exchange. Complete this question by entering your answers in the tabs below. Required 1 Required 2 What is the fair value of the equipment? Fair valuearrow_forwardThe following information relates to an exchange of assets by Wharton Company. The exchange lacks commercial substance. Old Equipment Book Value Fair Value Cash Paid Case I $75,000 $85,000 $15,000 Case II $50,000 $45,000 $7,000 For Case I, Wharton records the equipment at $ Answer on its books and reports a gain or (loss) of $ Answer on the exchange.arrow_forward
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