If I'm transferring an asset from one related company to another (no cash exchanged), what would the journal entry look like on both books with the following information?
Asset original cost = 160
Asset accumulated depreciation = 160
NBV = 0
FV = 40
GAAP says that non-reciprocal transfers must be recorded at fair value for the the transferor and transferee.
This is the entry I got for the transferee:
Asset (debit) 40
Gain (credit) 40
This is the partial entry I got for the transferor:
Asset (debit) 160
Loss (debit ) 40
Accum Depreciation (credit) 160
? (credit) 40
Are these entries correct and what would be the account for the question mark if that entry is even correct or not?