Question

an old machine having book value of rs 280000 is exchanged for a new machine of rs 500000 from tata machines ltd. at a value of rs 180000

Answer 1

new machine a/c. Dr. 500000
profit and loss a/c Dr. 100000
To old machine a/c 280000
To Tata machine Ltd/cash a/c 320000

Answer 2

The entry of the amount will be done in a better way  by -

Machine new a/c. Dr. 500000

To old machine a/c 280000

profit and loss a/c Dr. 100000

To Tata machine Ltd/cash a/c 320000”

This is the journal entry of the above queries. However, the amount might be different for different entries as per the value.