Get detailed and reliable answers to your questions with IDNLearn.com. Ask any question and get a detailed, reliable answer from our community of experts.

Pizza Company trades its used delivery cars for a new models at Hudson Toyota. The used cars have a book value of $60,000 (original cost $140,000 less $80,000 accumulated depreciation). The new cars have MSRP of $80,000. The fair value of the old cars based on estimation by third party is $50,000. After some negotiations between the Pizza Company and Hudson Toyota, the new cards would receive $10,000 discount and the trade in value of the old trucks in the amount of $55,000. The remaining portions is to be paid in cash. Prepare the journal entries assuming: a) commercial substance and b) no commercial substance.

Sagot :

Thank you for contributing to our discussion. Don't forget to check back for new answers. Keep asking, answering, and sharing useful information. Discover insightful answers at IDNLearn.com. We appreciate your visit and look forward to assisting you again.