Question

1. On 1/1/14 Cyber, Inc. decided to exchange a car with anoriginal cost of $30,000 and accumulated depreciation of $10,000for a new car with a Fair Market Value of $25,000. Cyber, Inc. alsohad to pay cash of $2,000.  Record the journalentry.

2. Instead of the exchange, assume that Cyber, Inc. decided tosell the car in question 1 for $25,000 cash to Allied Company on1/1/14. Record the entry.

3. Assume instead that Cyber, Inc. traded thecar in question 1 for a Clydesdale (a horse) with a FMV of $18,000on 1/1/14.  Record the entry.

 



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