Project

Edmond Company exchanged machinery with an appraised value of $1,755,000, a enter reproach of $2,700,000 and Accumulated Depreciation of $1,350,000 with Rosen Corporation for machinery Rosen owns. The machinery has an appraised value of $1,695,000, a put down cost of $3,240,000, and Accumulated Depreciation of $1,782,000. Rosen also gave Edmond $60,000 in the exchange. wad depreciation has already been updated. Instructions (a) ready the entries on both(prenominal) companies books presumptuous that the exchange had commercial substance. (Round whole computations to the nigh dollar.) (b) Prepare the entries on both companies books assuming that the exchange lacked commercial substance. (Round all computations to the nearest dollar.) (a)commercial Substance Edmond Machinery1,695,000Cost$2,700,000 Cash60,000A/D 1,350,000 Accum. DepreciationBV1,350,000 Machinery1,350,000FV 1,755,000 Gain on snotty-nosed ofGain$ 405,000 typeset Assets405,000 Machinery2,700 ,000 Rosen Machinery1,755,000Cost$3,240,000 Accum.

DepreciationA/D 1,782,000 Machinery1,782,000BV1,458,000 Gain on Exchange ofFV 1,695,000 Plant Assets237,000Gain$ 237,000 Machinery3,240,000 Cash60,000 (b)No Commercial Substance Edmond Machinery1,303,846 Cash60,000 Accumulated deprecationMachinery1,350,000 Gain on Exchange13,846 Machinery2,700,000 $60,000 ÷ ($60,000 + $1,695,000) × $405,000 = $13,846 Rosen Machinery1,518,000 Accumulated DepreciationMachinery1,782,000 Machinery3,240,000 Cash60,000If you want to dumbfound a full essay, order it on our website: OrderEssay.net

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