Crowe AG purchased a heavy-duty truck on March 1, 2019, for €40,000. It was estimated that it would have a useful life of 10 years and would have no residual value. The company uses the straight-line method of depreciation. It was traded on August 1, 2023, for a similar truck costing €41,000; €15,000 was allowed as trade - in value (also fair value) on the old truck and €22,000 was paid in cash. A comparison of expected cash flows for the trucks indicates the exchange has commercial substance. What is the entry to record the exchange?

Crowe AG purchased a heavy-duty truck on March 1, 2019, for €40,000. It was estimated that it would have a useful life of 10 years and would have no residual value. The company uses the straight-line method of depreciation. It was traded on August 1, 2023, for a similar truck costing €41,000; €15,000 was allowed as trade - in value (also fair value) on the old truck and €22,000 was paid in cash. A comparison of expected cash flows for the trucks indicates the exchange has commercial substance. What is the entry to record the exchange?

Name: 5 Crowe AG purchased a heavy-duty truck on March 1, 2019, for €40, 000
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Description: 5 Crowe AG purchased a heavy-duty truck on March 1, 2019, for €40, 000. It wasestimated that it would have a useful life of 10 years and would have no residualvalue. The company uses the straight-line method of depreciation. It was tradedon August 1,

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter11: Depreciation, Depletion, Impairment, And Disposal

Section: Chapter Questions

Problem 8P: Kam Company purchased a machine on January 2, 2019, for 20,000. The machine had an expected life of...

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