1/ Assuming the exchange has commercial substance in Case A, Grand Forks would record the cost of the new equipment and recognize a gain (loss) on this exchange at:

a. $60,000 ;$0 gain (loss) respectively

b. $75,000; $10,000 gain respectively

c. $75,000; $10,000( loss) respectively

d. $50,000; $0 gain (loss) respectively

e. None of the above.

Use the following to answer questions 37-39.

A company purchased a machine on January 1 of the year 2018, for $750,000. The machine's useful life estimated at 5 years or 20,000 hours, with a salvage value of $75,000). During the machine's useful life its actual hourly usage has been:

3,000 hours in 2018;

4,000 hours in 2019;

5,000 hours in 2020;

5,000 hours in 2021;

and 1,000 hours in 2022.

37- The depreciation expense in Year 5 under Units-of-Production method is:

A- $135,000

B- $33,750

C- $101250

D) None of the above

E) None of the above.

38 - The depreciation expense in Year 5 under Double- declining balance (declining balance) method is:

A- $22,200

B- $180,000

C-$ 108,000

D) $75,000

E) None of the above

39- The depreciation expense in Year 5 under Straight-Line method is:

A- $135,000

B- $109,000

C-$ 168,000

D) None of the above

4/ The amount of goodwill to record in a business acquisition is the excess of the fair value of the identifiable net assets acquired over the consideration given.

True or False