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The production manager of Marigold Corporation wants to acquire a different brand of machine by exchanging the machine that it currently uses in operations for the brand of equipment that others in the industry are using. The brand being used by other companies is more comfortable for the operators because it has different attachments that allow the operators to adjust the controls for a variety of arm and hand positions. The production manager has received the following offers from other companies:

1.		Secord Corp. offered to give Marigold a similar machine plus $9,890 in exchange for Marigolds machine.
2.		Bateman Corp. offered a straight exchange for a similar machine with essentially the same value in use.
3.		Shripad Corp. offered to exchange a similar machine with the same value in use, but wanted $3,440 cash in addition to Marigolds machine.
4.		The production manager has also contacted Ansong Corporation, a dealer in machines. To obtain a new machine from Ansong, Marigold would have to pay $39,990 and also trade in its old machine.

Marigolds machinery has a cost of $68,800, a net book value of $47,300, and a fair value of $39,560. The following table shows the information needed to record the machine exchange between the companies:

	Second	Batman	Shrip	Ansong
Machine cost	$51,600	$63,210	$68,800	$55,900
Accumulated depreciationmachinery	19,350	30,530	32,250	-0-
Fair value	29,670	39,560	43,000	79,550

For each of the four independent situations, assume that Marigold accepts the offer. Prepare the journal entries to record the exchange on the books of each company. Assume that transactions 2 and 3 lack commercial substance for Bateman Company and Shripad Company respectively.

Here are the list of accounts:

Accounts Payable Accounts Receivable Accumulated Depreciation - Buildings Accumulated Depreciation - Equipment Accumulated Depreciation - Leasehold Improvements Accumulated Depreciation - Machinery Accumulated Depreciation - Trucks Advertising Expense Asset Retirement Obligation Buildings Cash Common Shares Contributed Surplus Cost of Goods Sold Deferred Revenue - Government Grants Depreciation Expense Donation Revenue Equipment Finance Expense Finance Revenue Gain in Value of Investment Property Gain on Disposal of Building Gain on Disposal of Equipment Gain on Disposal of Machinery Gain on Disposal of Truck Gain on Sale of Land GST Payable GST Receivable Interest Expense Interest Income Interest Payable Interest Receivable Inventory Investment Property Land Land Improvements Loss in Value of Investment Property Loss on Disposal of Building Loss on Disposal of Equipment Loss on Disposal of Land Loss on Disposal of Machinery Loss on Disposal of Truck Machinery Maintenance and Repairs Expense Mineral Resources Mortgage Payable No Entry Notes Payable Notes Receivable Office Expense Owner's Drawings Prepaid Expenses Prepaid Insurance Profit on Construction Purchase Discounts Purchase Returns and Allowances Rent Expense Revaluation Gain or Loss Revaluation Surplus (OCI) Revenue - Government Grants Salaries and Wages Expense Salaries and Wages Payable Sales Revenue Service Revenue Supplies Supplies Expense Tenant Deposits Liability Trucks

Transaction 1 Margold Corporation Account Titles and Explanation Debit Credit Second Corporation Account Titles and Explanation Debit Credit Margold Corporation Credit Batman Company AheRjiguliR'llIFlees olitol H 5olla lili RI@ ilDe 101R (herliR Margold Company Account Titles and Explanation DebitCredit Shrip Company Account Titles and Explanation Debit Credit

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