Santana Company exchanged equipment used in its manufacturing operations plus $3,990 in cash for similar equipment used in the operations of Delaware Company. The following information pertains to the exchange.
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Santana Co.
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Delaware Co.
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Equipment (cost)
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$55,860
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$55,860
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Accumulated depreciation
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37,905
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19,950
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Fair value of equipment
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26,933
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30,923
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Cash given up
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3,990
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(a) Prepare the journal entries to record the exchange on the books of both companies. Assume that the exchange lacks commercial substance. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
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No.
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Account Titles and Explanation
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Debit
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Credit
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(a)
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Santana Company:
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(b)
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Delaware Company:
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(b) Prepare the journal entries to record the exchange on the books of both companies. Assume that the exchange has commercial substance. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
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No.
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Account Titles and Explanation
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Debit
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Credit
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(a)
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Santana Company
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(b)
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Delaware Company
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