Flint Const. Buffalo Mfg. Co. (a) No. Account Titles and Explanation Debit Credi
ID: 2555915 • Letter: F
Question
Flint Const.
Buffalo Mfg. Co.
(a)
No.
Account Titles and Explanation
Debit
Credit
1.
Flint Construction
2.
Buffalo Manufacturing
uring the current year, Flint Construction trades an old crane that has a book value of $133,200 (original cost $207,200 less accumulated depreciation $74,000) for a new crane from Buffalo Manufacturing Co. The new crane cost Buffalo $244,200 to manufacture and is classified as inventory. The following information is also available.Flint Const.
Buffalo Mfg. Co.
Fair value of old crane $121,360 Fair value of new crane $296,000 Cash paid 174,640 Cash received 174,640Explanation / Answer
No.
Account Titles and Explanation
Debit
Credit
1.
Flint Construction
Equipment($121,360+ $174,640)
$296,000
Accumulated Depreciation—Equipment
$ 74,000
Loss on Disposal of Equipment
$11,840
Equipment
$207,200
Cash
$174,640
2.
Buffalo Manufacturing
Cash
$174,640
Inventory
$121,360
Sales Revenue
$296,000
(To record exchange of inventory)
3.
Cash Paid
$174,640
Cash Received
$174,640
Book value of old crane
$207,200- $74,000 =133200
Fair value of old crane = $121,360
Loss on Disposal of Equipment =$11,840
No.
Account Titles and Explanation
Debit
Credit
1.
Flint Construction
Equipment($121,360+ $174,640)
$296,000
Accumulated Depreciation—Equipment
$ 74,000
Loss on Disposal of Equipment
$11,840
Equipment
$207,200
Cash
$174,640
2.
Buffalo Manufacturing
Cash
$174,640
Inventory
$121,360
Sales Revenue
$296,000
(To record exchange of inventory)
3.
Cash Paid
$174,640
Cash Received
$174,640
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