On november 30, 2010, Marco Company exchanged old office equipment and $24,000 for new office equipment. The old office equipment originally cost $48,000 and had accumulated depreciation to the date of disposal of $21,000. It is estimated that the fair market value of the old office equipment on november 30 was $36,000. The transaction has commercial substance.
Instructions:
Prepare the journal entries to record the exchange of Marco Company office equipment which has a calendar year end and uses the straight-line method of depreciation. Make sure to include the journal entries for the depreciation for the current year.