Brief Exercise 10-10 Novak Company traded a used welding machine (cost $12,420,

Question

Brief Exercise 10-10 Novak Company traded a used welding machine (cost $12,420, accumulated depreciation $4,140) for office equipment with an estimated fair value of $6,900. Novak also paid $4,140 cash in the transaction. Prepare the journal entry to record the exchange. (The exchange has commercial substance.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select '"No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit

Explanation / Answer

JOURNAL

Accounts Titles and Explanations

Debit

Credit

Office Equipment

6900

Accumulated Depreciation - Equipment

4140

Loss on Disposal of Machinery

5520

      Machinery

12420

       Cash

4140

JOURNAL

Accounts Titles and Explanations

Debit

Credit

Office Equipment

6900

Accumulated Depreciation - Equipment

4140

Loss on Disposal of Machinery

5520

      Machinery

12420

       Cash

4140

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