Two independent companies, Denver and Bristol, each own a warehouse and Denver agrees to pay Bristol $2,000 to complete the exchange. On January 1, they agree to an exchange in which no cash changes hands. The following information for the two warehouses is available: Denver Bristol Cost $90,000 $47,000 Accumulated depreciation 50,000 20,000 Fair value 35,000 37,000 Required: Assuming the exchange has commercial substance, prepare journal entries for Denver and Bristol to record the exchange.

Two independent companies, Denver and Bristol, each own a warehouse and Denver agrees to pay Bristol $2,000 to complete the exchange. On January 1, they agree to an exchange in which no cash changes hands. The following information for the two warehouses is available: Denver Bristol Cost $90,000 $47,000 Accumulated depreciation 50,000 20,000 Fair value 35,000 37,000 Required: Assuming the exchange has commercial substance, prepare journal entries for Denver and Bristol to record the exchange.

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter2: Basic Accounting Systems: Cash Basis

Section: Chapter Questions

Problem 6CDQ: Capstone Consulting Services acquired land 5 years ago for $200,000. Capstone recently signed an...

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	Denver	Bristol
Cost	$90,000	$47,000
Accumulated depreciation	50,000	20,000
Fair value	35,000	37,000

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