QUESTION 10 Blitzen Inc. owns equipment with a book value of $4,000 (cost $16,000 and accumulated depreciation $12,000). The fair value of the equipment was $10,000 when Blitzen exchanged it for similar equipment with a fair value of $8,000 plus $2,000 cash (cash is received by Blitzen.) The transaction lacks commercial substance. 1. How much is the total gain or loss realized on this exchange? (indicate gain or loss) 2. How much of this gain or loss should be recognized? (indicate gain or loss) Prepare the entry to record this exchange. TTT Arial 3 (12pt) T- - E . 3. QUESTION 10 Blitzen Inc. owns equipment with a book value of $4,000 (cost $16,000 and accumulated depreciation $12,000). The fair value of the equipment was $10,000 when Blitzen exchanged it for similar equipment with a fair value of $8,000 plus $2,000 cash (cash is received by Blitzen.) The transaction lacks commercial substance. 1. How much is the total gain or loss realized on this exchange? (indicate gain or loss) 2. How much of this gain or loss should be recognized? (indicate gain or loss) Prepare the entry to record this exchange. TTT Arial 3 (12pt) T- - E . 3