question archive Carla Company purchased equipment on January 2, 2016, for $121,300
Carla Company purchased equipment on January 2, 2016, for $121,300
Subject:AccountingPrice:2.84 Bought5
Carla Company purchased equipment on January 2, 2016, for $121,300. The equipment had an estimated useful life of 5 years with an estimated salvage value of $12,800.
Carla uses straight-line depreciation on all assets. On January 2, 2020, Carla exchanged this equipment plus $12,200 in cash for newer equipment.
The old equipment has a fair value of $50,400.
What is the journal entry to record the exchange on the books of Carla Company. Assume that the exchange has commercial substance.
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