Task: Exchange of Assets.
Assume that the following cases are independent and rely on the following data. Make entries on the books of both companies.
Bakken Co. Farley Co.
Equipment (cost) $540,000 $990,000
Accumulated depreciation 174,000 540,000
Fair market value of equipment 420,000 420,000
Question 1. Bakken Co. and Farley Co. traded the above equipment. They are dissimilar productive assets.
Bakken Co.'s Books: Farley Co.'s Books:
Question 2. Bakken Co. and Farley Co. traded the above equipment. They are similar productive assets.
Bakken Co.'s Books: Farley Co.'s Books:
Assume that the following cases are independent and rely on the following data. Make entries on the books of both companies.
Bakken Co. Farley Co.
Equipment (cost) $540,000 $990,000
Accumulated depreciation 174,000 630,000
Fair market value of equipment 336,000 420,000
Cash received (paid) (84,000) 84,000
Question 3. Bakken Co. and Farley Co. traded the above equipment. They are dissimilar productive assets.
Bakken Co.'s Books: Farley Co.'s Books:
Question 4. Bakken Co. and Farley Co. traded the above equipment. They are similar productive assets.
Bakken Co.'s Books: Farley Co.'s Books: