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question patrick sharp co has a zamboni ice resurfacer equipment that cost 735 000 o 4292629

Question

Patrick Sharp Co. has a Zamboni (ice-resurfacer equipment) that cost $735,000 on January 31st, 2011. Sharp Co. has accumulated depreciation of $465,000 on September 1st, 2016 for this Zamboni. The fair value of Sharp’s Zamboni is $322,000 on September 1st, 2016. Sidney Crosby Inc. negotiated an exchange of their Zambonis with Patrick Sharp Co. on September 1st, 2016. On the exchange date, Crosby’s Zamboni had a fair value of $205,000. Crosby’s Zamboni was purchased on January 1st, 2010 for $930,000. On September 1st, 2016, Crosby has accumulated depreciation of $750,000. The exchange lacked commercial substance. Patrick Sharp also received $30,000 cash.

Instructions

(a) Show the journal entry to record the exchange for Patrick Sharp Co. as of September 1st, 2016.

(b) Show the journal entry to record the exchange for Sidney Crosby Inc. as of September 1st, 2016.

 

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