For each of the following assumptions and referring to the equipment mentioned in SE 7, compute the gain (loss) on the exchange, the cash payment required, and the amount at which the new equipment would be recorded:

1. The equipment was traded in on dissimilar equipment that had a list price of

$12,000. A $3,800 trade-in was allowed, and the balance was paid in cash. Gains and losses are to be recognized.

2. The equipment was traded in on dissimilar equipment that had a list price of

$12,000. A $1,750 trade-in was allowed, and the balance was paid in cash. Gains and losses are to be recognized.

3. Same as 2, except the items are similar and gains and losses are not to be recognized.Lo1