On August 1, Gold Company exchanged a machine for a similar machine owned by Cowboy Company and also received $7,000 cash from Cowboy Company. Gold's machine had an original cost of $80,000, accumulated depreciation to date of $14,500, and a fair market value of $60,000. Cowboy's machine had an original cost of
$95,000 and a book value of $45,000 and a fair value of $53,000.
Required:

a. Prepare the necessary journal entry by Gold Company to record this transaction.
b. Prepare the necessary journal entry by Cowboy Company to record this transaction.

Question

On August 1, Gold Company exchanged a machine for a similar machine owned by Cowboy Company and also received $7,000 cash from Cowboy Company. Gold's machine had an original cost of $80,000, accumulated depreciation to date of $14,500, and a fair market value of $60,000. Cowboy's machine had an original cost of
$95,000 and a book value of $45,000 and a fair value of $53,000.
Required:

a. Prepare the necessary journal entry by Gold Company to record this transaction.
b. Prepare the necessary journal entry by Cowboy Company to record this transaction.

Quizplus · Accepted Answer

The Answer of On August 1, Gold Company exchanged a machine for a similar machine owned by Cowboy Company and also received $7,000 cash from Cowboy Company. Gold's machine had an original cost of $80,000, accumulated depreciation to date of $14,500, and a fair market value of $60,000. Cowboy's machine had an original cost of
$95,000 and a book value of $45,000 and a fair value of $53,000.
Required:

a. Prepare the necessary journal entry by Gold Company to record this transaction.
b. Prepare the necessary journal entry by Cowboy Company to record this transaction.

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