Homework Answers
GIVEN THAT :
Market value of new case = $40000
AND
Orginal cost of old system = $35000
Less : Accumulated depreciation = ( $31500 )
Book value of old system = $3500
Add : Cash paid in exchange = $37500
_________
$41000
Therefore, Loss on exchange = $1000
As the transaction has commercial substance, loss on exchange should be recognized and as a result the company should record the new heating system at $4000.
____ × ____
ALL THE BEST,
Keep Learning
Add Answer to:
A company bought new heating system for $40,000 and was given a trade-in of $2,500 on...
A company bought new heating system for $52,000 and was given a trade-in of $2,200 on an old heating system, so the comp...
A company bought new heating system for $52,000 and was given a trade-in of $2,200 on an old heating system, so the company paid $49,800 cash with the trade-in. The old system had an original cost of $46,400 and accumulated depreciation of $42,600. If the transaction has commercial substance, the company should record the new heating system at:
8. (8 points) This machinery was acquired by trading in used machinery. Facts concerning the trade-in...
8. (8 points) This machinery was acquired
by trading in used machinery. Facts concerning the trade-in are as
follows. Cost of machinery traded (old machine) $100,000
Accumulated depreciation to date of sale (old machine) 40,000 Fair
value of machinery traded (old machine) 83,000 Cash received 12,000
Fair value of machinery acquired (new machine) 71,000 Record the
journal entry for the above nonmonetary asset exchange for the
following scenarios: a. The transaction has commercial substance.
b. The transaction lacks commercial substance...
8. (8 points) This machinery was acquired by trading in used machinery. Facts concerning the trade-in are as follows. Co...
8. (8 points) This machinery was acquired
by trading in used machinery. Facts concerning the trade-in are as
follows. Cost of machinery traded (old machine) $100,000
Accumulated depreciation to date of sale (old machine) 40,000 Fair
value of machinery traded (old machine) 83,000 Cash received 12,000
Fair value of machinery acquired (new machine) 71,000 Record the
journal entry for the above nonmonetary asset exchange for the
following scenarios: a. The transaction has commercial substance.
b. The transaction lacks commercial substance...
8. (8 points) This machinery was acquired by trading in used machinery. Facts concerning the trade-...
8. (8 points) This machinery was acquired by trading in used machinery. Facts concerning the trade- in are as follows. Cost of machinery traded (old machine) $100,000 Accumulated depreciation to date of sale (old machine) 40,000 Fair value of machinery traded (old machine) 83,000 Cash received 12,000 Fair value of machinery acquired (new machine) 71,000 Record the journal entry for the above nonmonetary asset exchange for the following scenarios: a. The transaction has commercial substance. b. The transaction lacks commercial...
Hunter Saling Company exchanged an old sailboat for a new one. The old sailboat had a...
Hunter Saling Company exchanged an old sailboat for a new one. The old sailboat had a cost of $270,000 and accumulated depreciation of $81,000. The new sailboat had an invoice price of $299,000. Hunter received a trade in allowance of $191,000 on the old sailboat, which meant the company paid $108,000 in addition to the old sailboat to acquire the new sailboat. If this transaction has commercial substance, what amount of gain or loss should be recorded on this exchange?
Hunter Sailing Company exchanged an old sailboat for a new one. The old sailboat had a...
Hunter Sailing Company exchanged an old sailboat for a new one. The old sailboat had a cost of $300,000 and accumulated depreciation of $150,000. The new sailboat had an invoice price of $326,000. Hunter received a trade in allowance of $166,000 on the old sailboat, which meant the company paid $160,000 in addition to the old sailboat to acquire the new sailboat. If this transaction has commercial substance, what amount of gain or loss should be recorded on this exchange?
Hunter Sailing Company exchanged an old sailboat for a new one. The old sailboat had a...
Hunter Sailing Company exchanged an old sailboat for a new one. The old sailboat had a cost of $160,000 ad accumulated deprecaition of $100,000. The new sailboat had an invoice price of $270,000. Hunter received a trade allowance of $70,000 on the old sailboat, which meant the company paid $200,000 in addition to the old sailboat to acquire the new sailboat. If this transaction has commercial substance, what amount of gain or loss should be recorded on this exchange?
Cedric Company recently traded in an older model computer for a new model. The old model’s...
Cedric Company recently traded in an older model computer for a new model. The old model’s book value was $191,000 (original cost of $421,000 less $230,000 in accumulated depreciation) and its fair value of the old equipment is $180,000. Cedric paid $61,000 to complete the exchange which has commercial substance. Required: 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.)
Q.3 Prepare the journal entries to record the following transactions for Eklund Company which has a...
Q.3 Prepare the journal entries to record the following transactions for Eklund Company which has a calendar year end and uses the straight-line method of depreciation. a)On September 30, 2011, the company exchanged old delivery equipment and $24,000 for new delivery equipment. The old delivery equipment was purchased on January 1, 2009, for $84,000 and was estimated to have a $12,000 salvage value at the end of its 5-year life. Depreciation on the delivery equipment has been recorded through December...
Cedric Company recently traded in an older model of equipment for a new model. The old...
Cedric Company recently traded in an older model of equipment for a new model. The old model's book value was $270,000 (original cost of $590,000 less $320,000 in accumulated depreciation) and its fair value was $300,000. Cedric paid $70,000 to complete the exchange which has commercial substance. Required: 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.) View transaction list Journal entry worksheet...
8. (8 points) This machinery was acquired
by trading in used machinery. Facts concerning the trade-in are as
follows. Cost of machinery traded (old machine) $100,000
Accumulated depreciation to date of sale (old machine) 40,000 Fair
value of machinery traded (old machine) 83,000 Cash received 12,000
Fair value of machinery acquired (new machine) 71,000 Record the
journal entry for the above nonmonetary asset exchange for the
following scenarios: a. The transaction has commercial substance.
b. The transaction lacks commercial substance...
8. (8 points) This machinery was acquired
by trading in used machinery. Facts concerning the trade-in are as
follows. Cost of machinery traded (old machine) $100,000
Accumulated depreciation to date of sale (old machine) 40,000 Fair
value of machinery traded (old machine) 83,000 Cash received 12,000
Fair value of machinery acquired (new machine) 71,000 Record the
journal entry for the above nonmonetary asset exchange for the
following scenarios: a. The transaction has commercial substance.
b. The transaction lacks commercial substance...
8. (8 points) This machinery was acquired by trading in used machinery. Facts concerning the trade- in are as follows. Cost of machinery traded (old machine) $100,000 Accumulated depreciation to date of sale (old machine) 40,000 Fair value of machinery traded (old machine) 83,000 Cash received 12,000 Fair value of machinery acquired (new machine) 71,000 Record the journal entry for the above nonmonetary asset exchange for the following scenarios: a. The transaction has commercial substance. b. The transaction lacks commercial...
Cedric Company recently traded in an older model of equipment for a new model. The old model's book value was $270,000 (original cost of $590,000 less $320,000 in accumulated depreciation) and its fair value was $300,000. Cedric paid $70,000 to complete the exchange which has commercial substance. Required: 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.) View transaction list Journal entry worksheet...
Most questions answered within 3 hours.
-
A speeding car is traveling along a straight road with a
constant speed of 100 km/hour....
asked 12 minutes ago -
When 60.1 gg of calcium is reacted with nitrogen gas, 31.7 gg of
calcium nitride is...
asked 16 minutes ago -
The random variable X is exponentially distributed, where X
represents the time it takes for a...
asked 31 minutes ago -
a) Write a verilog module for 1:4 Demultiplexer using verilog
primitives.
b) Design 1-to-4 DEMUX using...
asked 26 minutes ago -
MATLAB
write a MATLAB function (1) output a third-order polynomial
function with the coefficients as the...
asked 39 minutes ago -
A z-score
communicates a raw score’s "relative standing"
under the normal curve in relation to:
asked 47 minutes ago -
An object is vibrating on a spring with the following equation
of motion:
?=(30 ??)cos((2?)/(160)?)
a)...
asked 47 minutes ago -
Vulcan Flyovers offers scenic overflights of Mount St. Helens,
the volcano in Washington State that explosively...
asked 49 minutes ago -
If organizations do not adapt fast enough and move incrementally
from the twentieth-century model to the...
asked 50 minutes ago -
A helium balloon with 2.5L of gas has a gauge pressure of 10,000
Pa. The balloon...
asked 54 minutes ago -
What is responsible for Jupiter's enormous magnetic field?
asked 1 hour ago -
At the end of the year, a company offered to buy 5,000 units of
a product...
asked 1 hour ago