Chapter : Fixed Assets Presented below is a data of property held by Luciana and schedule of property dispositions The following additional information is available : a. Machine: On January 5, the used machine was exchanged for another machine. The new machine lists for $25,000 and exchanger gives Luciana a trade-in allowance of $8,000 for the used machine (The exchange has commercial substance) b. Automobile: On January 10, Luciana exchanged used automobile for a new automobile. In addition to the automobile, Luciana must pay $5,000 cash for a new automobile (The exchange lacks commercial substance) Instructions : a. Indicate how these items would be reported on the income statement of Luciana. b. Make necessary journal to recognize all property dispositions’ transaction
Chapter : Fixed Assets Presented below is a data of property held by Luciana and schedule of property dispositions The following additional information is available : a. Machine: On January 5, the used machine was exchanged for another machine. The new machine lists for $25,000 and exchanger gives Luciana a trade-in allowance of $8,000 for the used machine (The exchange has commercial substance) b. Automobile: On January 10, Luciana exchanged used automobile for a new automobile. In addition to the automobile, Luciana must pay $5,000 cash for a new automobile (The exchange lacks commercial substance) Instructions : a. Indicate how these items would be reported on the income statement of Luciana. b. Make necessary journal to recognize all property dispositions’ transaction
Chapter1: Financial Statements And Business Decisions
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Chapter : Fixed Assets
Presented below is a data of property held by Luciana and schedule of property dispositions
The following additional information is available :
a. Machine: On January 5, the used machine was exchanged for another machine. The new machine lists for $25,000 and exchanger gives Luciana a trade-in allowance of $8,000 for the used machine (The exchange has commercial substance)
b. Automobile: On January 10, Luciana exchanged used automobile for a new automobile. In addition to the automobile, Luciana must pay $5,000 cash for a new automobile (The exchange lacks commercial substance)
Instructions :
a. Indicate how these items would be reported on the income statement of Luciana.
b. Make necessary journal to recognize all property dispositions’ transaction
Transcribed Image Text:Machine
Automobile
Cost
$25,000
$16,000
Acc Depre
$9,000
$4,000
Fair Value
$20,000
$10,000
Nature of
Disposition
Trade-in
Trade-in
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