8. Johnny trades a used laptop for a new model. The exchange lacks commercial substance. The used laptop has a book value of $1,000 (historical cost of $2.500 minus accumulated depreciation of $1,500) and a fair value of $1.200. The new model has a list price of $2,500. In addition to trading in the used laptop. Johnny must pay $800 cash in exchange for the new model.
What is the journal entry needed to record this transaction?
9. Barry trades newer used equipment for an older version of the same equipment. The exchange lacks commercial substance. The newer equipment that Barry trades away has a book value of $90,000 (historical cost of $140,000 minus accumulated depreciation of $50,000) and a fair value of $100,000. In addition to receiving the older equipment, Barry receives $20,000 in the exchange. What is the journal entry needed to record this transaction?
