(Nonmonetary Exchanges) - On August 1, Hyde, Inc. exchanged productive assets with Wiggins,
Not what you're looking for?
On August 1, Hyde, Inc. exchanged productive assets with Wiggins, Inc. Hyde's asset is referred to below as Asset A, and Wiggins is referred to as Asset B. The following facts pertain to these assets.
Asset A Asset B
Original cost $96,000 $110,000
Accumulated depreciation (to date of exchange) 40,000 47,000
Fair value at date of exchange 60,000 75,000
Cash paid by Hyde, Inc. 15,000
Cash received by Wiggins, Inc. 15,000
Instructions
(a) Assuming that the exchange of Assets A and B has commercial substance, record the exchange for both Hyde, Inc. and Wiggins, Inc. in accordance with generally accepted accounting principles.
(b) Assuming that the exchange of Assets A and B lacks commercial substance, record the exchange for both Hyde, Inc. and Wiggins, Inc. in accordance with generally accepted accounting principles.
Purchase this Solution
Solution Summary
The solution records the exchange for Hyde, Inc and WIggins, Inc in accordance to accounting principles.
Solution Preview
Instruction A
Hyde, Inc.
DR: Accumulated depreciation 40,000
DR: Asset - new 67,000
DR: Gain 4,000
CR: Asset - old 96,000
CR: ...
Purchase this Solution
Free BrainMass Quizzes
Social Media: Pinterest
This quiz introduces basic concepts of Pinterest social media
Business Ethics Awareness Strategy
This quiz is designed to assess your current ability for determining the characteristics of ethical behavior. It is essential that leaders, managers, and employees are able to distinguish between positive and negative ethical behavior. The quicker you assess a person's ethical tendency, the awareness empowers you to develop a strategy on how to interact with them.
Transformational Leadership
This quiz covers the topic of transformational leadership. Specifically, this quiz covers the theories proposed by James MacGregor Burns and Bernard Bass. Students familiar with transformational leadership should easily be able to answer the questions detailed below.
IPOs
This Quiz is compiled of questions that pertain to IPOs (Initial Public Offerings)
Production and cost theory
Understanding production and cost phenomena will permit firms to make wise decisions concerning output volume.