Question: Smith Inc. exchanged equipment that it uses in its operations for a machine that is used in the operations of Clark Inc. Smith also paid

Smith Inc. exchanged equipment that it uses in its operations for a machine that is used in the operations of Clark Inc. Smith also paid Clark $5,000 in cash. The following information pertains to the exchange: Smith Inc. Clark Inc. $52,500 $57,000 Equipment (cost) Machine (cost) Accumulated depreciation Fair value 32,500 23,000 27,000 32,000 Instructions: Prepare the journal entries to record the exchange on the books of both companies, assuming the exchanges is determined to have commercial substance

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