A&E Company exchanged asset A to acquire asset B from PVP Company. PVP paid $60,000 cash to A&E in this exchange. The following information pertains to the exchange:
|
A&E Asset A |
PVP Asset B |
|
|
Cost |
$2,700,000 |
$3,240,000 |
|
Accumulated depreciation |
1,350,000 |
1,782,000 |
|
Fair market value |
1,755,000 |
1,695,000 |
|
Cash given by PVP |
60,000 |
Prepare journal entries using the answer sheet provided to record the exchange on the books of A&E company assuming the exchange lacks commercial substance: