Question: Gamma Co. owns a machine that costs $84,800 with accumulated depreciation of $36,800. Gamma exchanges the machine for a newer model that has a market

Gamma Co. owns a machine that costs $84,800 with accumulated depreciation of $36,800. Gamma exchanges the machine for a newer model that has a market value of $104,000.

(1) Record the exchange assuming Gamma paid $60,000 cash and the exchange has commercial substance.

(2) Record the exchange assuming Gamma pays $44,000 cash and the exchange lacks commercial substance.

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