plus Q2 Mathews Company exchanged equipment used in its manufacturing operations $12,500 in cash for similar equipment used in the operations of Biggio Company. The following information pertains to the exchange. Mathews Co. Biggio Co. Equipment (cost) Accumulated depreciation Fair value of equipment Cash given up Baiggio Book Value Instructions (a) Prepare the journal entries to record the exchange on the books of both companie Assume that the exchange lacks commercial substance. Mathewes Book Value Book Value = Fair Value Baiggio Book Value Fair Value $153,000 $31,000 $132,500 $12,500 (b) Prepare the journal entries to record the exchange on the books of both companie Assume that the exchange has commercial substance. Fair Value Fair Value Gain (Loss) Gain (Loss) $146,000 $18,500 $145,000 Gain (Loss) Gain (Loss)

plus Q2 Mathews Company exchanged equipment used in its manufacturing operations $12,500 in cash for similar equipment used in the operations of Biggio Company. The following information pertains to the exchange. Mathews Co. Biggio Co. Equipment (cost) Accumulated depreciation Fair value of equipment Cash given up Baiggio Book Value Instructions (a) Prepare the journal entries to record the exchange on the books of both companie Assume that the exchange lacks commercial substance. Mathewes Book Value Book Value = Fair Value Baiggio Book Value Fair Value $153,000 $31,000 $132,500 $12,500 (b) Prepare the journal entries to record the exchange on the books of both companie Assume that the exchange has commercial substance. Fair Value Fair Value Gain (Loss) Gain (Loss) $146,000 $18,500 $145,000 Gain (Loss) Gain (Loss)

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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