Textile Manufacturer Sheridan Corp Exchanges Robotic Equipment With An Original Cost Of 20 000 And A Carrying Amount O 1 (278.14 KiB) Viewed 37 times
Textile manufacturer Sheridan Corp. exchanges robotic equipment with an original cost of $20,000 and a carrying amount of $11,800 with the equipment rental company Grouper Corp. The equipment that is received in exchange from Grouper Corp. has an original cost of $35,000 and a carrying amount of $16,500, performs different functions, and has a fair value of $22,200. Both companies are 100% owned by the same individual. Because they are closely held companies, they both follow ASPE. Prepare the journal entries for both companies to record the exchange. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Sheridan Corp. Account Titles and Explanation Debit Credit Equipment (new) 22,200 Accumulated Depreciation-Equipment 8,200 Equipment (old) 20,000 Gain on Disposal of Eauipment 10,400
Grouper Corp. Account Titles and Explanation Debit Credit Equipment (new) 22,200 Accumulated Depreciation-Equipment 18,500 Equipment (old) 35,000 Gain on Disposal of Equipment 5,700
Join a community of subject matter experts. Register for FREE to view solutions, replies, and use search function. Request answer by replying!