Ayayai Limited owns 90% of Blossom Inc. During 2023, Ayayai acquired a machine from Blossom in exchange for its own used machine. Both companies are in the tool-making business. The agreed exchange amount is $1,100, although the transaction is nonmonetary. Blossom has an original cost of $6,000 and carries its machine on its books at a carrying amount of $790, whereas Ayayai has an original cost of $7,000 and carries its machine on its books at a carrying amount of $990. Neither company has a balance in the Contributed Surplus account relating to previous related-party transactions. Both Ayayai and Blossom follow ASPE. Using the related party decision tree and answer the following.
Ayayai Limited owns 90% of Blossom Inc. During 2023, Ayayai acquired a machine from Blossom in exchange for its own used machine. Both companies are in the tool-making business. The agreed exchange amount is $1,100, although the transaction is nonmonetary. Blossom has an original cost of $6,000 and carries its machine on its books at a carrying amount of $790, whereas Ayayai has an original cost of $7,000 and carries its machine on its books at a carrying amount of $990. Neither company has a balance in the Contributed Surplus account relating to previous related-party transactions. Both Ayayai and Blossom follow ASPE. Using the related party decision tree and answer the following.
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter7: Accounting For Cash
Section: Chapter Questions
Problem 1SEB: CHECKING ACCOUNT TERMS Match the following words with their definitions:
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