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On June 1 , ABC Corp. purchased land by transferring $100,000 cash and a machine...

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Accounting

On June 1 , ABC Corp. purchased land by transferring $100,000 cash and a machine to another company. The machine given up had an original cost of $600,000, a book value of $100,000, and a fair market value of $300,000.

Prepare the June 1 journal entry ABC should make to record the exchange of the machine and cash for the land, assuming the exchange has commercial substance.

If the above exchange were deemed to have non-commercial substance, by what amount should the Land account be debited?

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