Answered: Record the gain or loss for Midwest…

Business

Accounting

Record the gain or loss for Midwest Chicken on the exchange of the equipment.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 12PB: Farm Fresh Agriculture Company purchased Sunny Side Egg Distribution for $400,000 cash when Sunny...

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Question

China Inn and Midwest Chicken exchanged assets. Midwest Chicken received restaurant equipment and gave delivery equipment.
The fair value and book value of the delivery equipment given were $30,400 and $32,300 (original cost of $36,600 less accumulated
depreciation of $4,300), respectively. To equalize market values of the exchanged assets, Midwest Chicken received $8,900 in cash
from China Inn.
Record the gain or loss for Midwest Chicken on the exchange of the equipment. (If no entry is required for a particular
transaction/event, select "No Journal Entry Required" In the first account fleld.)
View transaction list
Journal entry worksheet
1
Record the gain or loss for Midwest Chicken on the exchange of the
equipment.
Note: Enter debits before credits.
Transaction
1
Record entry
General Journal
Clear entry
Debit
Credit
View general journal

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Farm Fresh Agriculture Company purchased Sunny Side Egg Distribution for $400,000 cash when Sunny Side had net assets worth $390,000. A. What is the amount of goodwill in this transaction? B. What is Farm Fresh Agriculture Companys journal entry to record the purchase of Sunny Side Egg Distribution? C. What journal entry should Farm Fresh Agriculture Company write when the company tests for impairment and determines that goodwill is worth $1,000 in the year following the purchase of Sunny Side?
China Inn and Midwest Chicken exchanged assets. Midwest Chicken received equipment and gave a delivery truck. The fair value and book value of the delivery truck given were $31,000 and $32,600 (original cost of $37,000 less accumulated depreciation of $4,400), respectively. To equalize market values of the exchanged assets, Midwest Chicken received $9,000 in cash from China Inn. At what amount did Midwest Chicken record the equipment? How much gain or loss did Midwest Chicken recognize on the exchange?
China Inn and Midwest Chicken exchanged assets. Midwest Chicken received restaurant equipment and gave delivery equipment. The fair value and book value of the delivery equipment given were $25,000 and $28,000 (original cost of $33,000 less accumulated depreciation of $5,000), respectively. To equalize market values of the exchanged assets, Midwest Chicken received $8,000 in cash from China Inn. Record the gain or loss for Midwest Chicken on the exchange of the equipment. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)
China Inn and Midwest Chicken exchanged assets. China Inn received a delivery truck and gave equipment. The fair value and book value of the equipment were $22,000 and $12,000 (original cost of $45,000 less accumulated depreciation of $33,000), respectively. To equalize market values of the exchanged assets, China Inn paid $9,000 in cash to Midwest Chicken. At what amount did China Inn record the delivery truck? How much gain or loss did China Inn recognize on the exchange?
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