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29 November, 16:53

A computer server system, which had cost $210,000 and had accumulated

depreciation of $147,000, was traded for a new system with a fair market value

of $235,000. The old system and cash of $180,000 were given for the new system.

Prepare the journal entry for the exchange of these similar assets

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Answers (2)
  1. 29 November, 17:17
    0
    The cost of the old computer server system was $210000

    The depreciation is $147000

    The book value of the old system is

    $210000 - $147000 = $63000

    With the additional cash

    $63000 + $180000 = $243000

    The new system costs $235000

    There is a difference of $10000.
  2. 29 November, 20:31
    0
    The journal entries for the given above would include the following:

    (1) Initial cost: $210,000

    (2) depreciation: $147,000

    (3) final value of old server: $63,000

    (4) cash on hand: $180,000

    In fact, the price of the depreciated old system is equal to $63,000 and that the money out of $180,000 will actually mean that the new system was bought for $243,000. This is slightly higher compared to the true price of the new system.
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Home » Business » A computer server system, which had cost $210,000 and had accumulated depreciation of $147,000, was traded for a new system with a fair market value of $235,000. The old system and cash of $180,000 were given for the new system.
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