Pittsburgh Company exchanged a used machine for a used machine that was held by St. Louis Corporation. Pittsburgh’s machine had a fair value of $9,000, an original cost of $180,000, and related accumulated amortization of $175,000. St. Louis’ machine had a market value of $11,000, an original cost of $170,000, and related accumulated amortization of $160,000.

Of the two measures of fair value noted above, the fair value of Pittsburgh’s machine is determined to be more reliable.

As part of the arrangement between the two parties, Pittsburgh Company also paid $3,000 in cash to St. Louis Corporation. Pittsburgh Company’s accountant, in consultation with the Company’s auditor, has determined that this non-monetary exchange transaction lacks commercial substance.

Required (show any calculations you make):

Prepare and present the journal entry or entries to record the exchange. You need present only those entries that relate to Pittsburgh Company’s accounting.

Assume the same facts as above, but instead assume that it has been decided that the transaction has commercial substance. Prepare and present the journal entry or entries that Pittsburgh Company would make to record the exchange.