During the current year, Flounder Construction Ltd. traded in two relatively new small cranes (cranes no. 6RT and 579) for a larger crane that Flounder expects will be more useful for the particular contracts that the company has to fulfill over the next couple of years. The new crane is acquired from Novak Manufacturing Inc., which has agreed to take the smaller equipment as trade-ins and also pay $13,500 cash to Flounder. The new crane cost Novak $172,500 to manufacture and is classified as inventory. The following information is available: Flounder Novak $127,000 112,500 Cost of crane #6RT Cost of crane #579 Accumulated depreciation #6RT Accumulated depreciation, #579 Fair value, #6RT 11,000 14,000 127.000 Fair value, #S79 86,000 Fair value of new crane $199,500 Cash paid 13,500 13,500 Cash paid Cash received 13,500 (a) Assume that this exchange has commercial substance. Prepare the journal entries on the books of (1) Flounder Construction and (2) Novak Manufacturing. Novak uses a perpetual inventory system. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Flounder Construction Debit Account Titles and Explanation Credit Flounder Construction Debit Credit Account Titles and Explanation Novak Manufacturing Account Titles and Explanation Debit Credit LUNA (To record sale with trade-in) (To record cost of goods sold)