Asset Traded for Similar Asset

A printing press priced at a fair market value of $286,800 is acquired in a transaction that has commercial substance by trading in a similar press and paying cash for the difference between thetrade-in allowanceand the price of the new press.

a.Assuming that the trade-in allowance is $11,500, what is the amount of cash given?

$

b.Assuming that thebook valueof the press traded in is $12,200, what is the gain or loss on the exchange?

$loss