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Question: EXERCISE 10-28

EXERCISE 10-28 <^ -rojg/ TROUBLED DEBT RESTRUCTURING-ASSET SWAP The Buck Machine Company has outstanding a $150,000 note payable to the Ontario Investment Corporation. Because of fmancial difficulties. Buck negotiates with Ontario to exchange inventor)^ of machine parts to satisfy the debt. The cost of the inventory transferred is carried on Buck's books at $90,000. The estimated retail value of the inventor)^ is $ 140,000. Buck uses a perpetual inventory' system. Prepare journal entries for the exchange on the books of both Buck Machine Company and Ontario Investment Corporation according to the requirements of FASB Statement No. 15.

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