Question
Equipment that cost $660,000 and has accumulated depreciation of $300,000 is exchanged for equipment with a fair value of $480,000 and $120,000 cash is received.
Equipment that cost $660,000 and has accumulated depreciation of $300,000 is exchanged for equipment with a fair value of $480,000 and $120,000 cash is received. The exchange lacked commercial substance.
**PLEASE SHOW YOUR WORK**
110. The gain to be recognized from the exchange is
a. $48,000
b. $60,000
c. $180,000
d. $240,000
Equipment that cost $660,000 and has accumulated depreciation of $300,000 is exchanged for equipment with a fair value of $480,000 and $120,000 cash is received. The exchange lacked commercial substance.
**PLEASE SHOW YOUR WORK**
111. The new equipment should be recorded at
a. $480,000.
b. $360,000.
c. $300,000.
d. $288,000.
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Internal Auditing Assurance And Advisory Services
Authors: Kurt R. Reding, Paul J. Sobel, Urton L. Anderson, Michael J. Head, Sridhar Ramamoorti, Mark Salamasick, Cris Riddle
3rd Edition
0894137409, 978-0894137402
