Question
As of December 31, 2014, a machine that originally cost $600,000 and has annual depreciation of $100,000 and has accumulated depreciation of $450,000. On April
As of December 31, 2014, a machine that originally cost $600,000 and has annual depreciation of $100,000 and has accumulated depreciation of $450,000. On April 1, 2015, when the machine has a fair value of $137,500, it is exchanged for a machine with a fair value of $675,000 and the proper amount of cash is paid. The exchange has commercial substance.
| ___ 1. | The gain to be recorded on the exchange is | |
|
| A) | $0. |
|
| B) | $12,500 |
|
| C) | $25,000 |
|
| D) | $75,000 |
|
| E) | Some other answer than those shown above. |
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Principles Of External Auditing
Authors: Brenda Porter, Jon Simon, David Hatherly
2nd Edition
470842973, 470842970, 978-0470842973
