On August 1, Silver Company exchanged a machine for a similar machine owned by Wrangler Company and also received $7, 000 cash from Wrangler Company.Silver's machine had an original cost of $70, 000, accumulated depreciation to date of $34, 500, and a fair market value of $60, 000.Wrangler's machine had a book value of $45, 000 and a fair value of $53, 000.
Required:
Prepare the necessary journal entry by Silver Company to record this transaction assuming
a. Siver will use the newly acquired machine in the same manner as the old one.
b. Silver's use of the new machine will be substantially different from the old one.

Question

On August 1, Silver Company exchanged a machine for a similar machine owned by Wrangler Company and also received $7, 000 cash from Wrangler Company.Silver's machine had an original cost of $70, 000, accumulated depreciation to date of $34, 500, and a fair market value of $60, 000.Wrangler's machine had a book value of $45, 000 and a fair value of $53, 000.
Required:
Prepare the necessary journal entry by Silver Company to record this transaction assuming
 a. Siver will use the newly acquired machine in the same manner as the old one.
b. Silver's use of the new machine will be substantially different from the old one.

Quizplus · Accepted Answer

The Answer of On August 1, Silver Company exchanged a machine for a similar machine owned by Wrangler Company and also received $7, 000 cash from Wrangler Company.Silver's machine had an original cost of $70, 000, accumulated depreciation to date of $34, 500, and a fair market value of $60, 000.Wrangler's machine had a book value of $45, 000 and a fair value of $53, 000.
Required:
Prepare the necessary journal entry by Silver Company to record this transaction assuming
 a. Siver will use the newly acquired machine in the same manner as the old one.
b. Silver's use of the new machine will be substantially different from the old one.

On August 1, Silver Company Exchanged a Machine for a Similar