Question: A B C D E F G H Q2 Mathews Company exchanged equipment used in its manufacturing operations plus $7,800 in cash for similar equipment

A B C D E F G H Q2 Mathews Company exchanged equipment used in its manufacturing operations plus $7,800 in cash for similar equipment used in the operations of Biggio Company. The following information pertains to the exchange. Mathews Co. Biggio Co. Equipment (cost) $153,000 $146,000 Accumulated depreciation $33,000 $17,500 Fair value of equipment $135,200 $143,000 Cash given up $7,800 Instructions (a) Prepare the journal entries to record the exchange on the books of both companies. Assume that the exchange lacks commercial substance. Mathewes Book Value Fair Value Gain (Loss) Baiggio Book Value Fair Value Gain (Loss) 34 35 (b) Prepare the journal entries to record the exchange on the books of both companies. 36 Assume that the exchange has commercial substance. 37 38 Book Value Fair Value Gain (Loss) 39 40 41 42 43 44 45 46 47 Baiggio 48 Book Value Fair Value Gain (Loss) 49 50 51 52 53 54 55 56 57

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