Question:

China Inn and Midwest Chicken exchanged assets. Midwest Chicken received equipment and gave a delivery truck. The fair value and book value of the delivery truck given were $28,600 and $31,400 (original cost of $35,400 less accumulated depreciation of $4,000), respectively. To equalize market values of the exchanged assets, Midwest Chicken received $8,600 in cash from China Inn.

1.At what amount did Midwest Chicken record the equipment? 2.How much gain or loss did Midwest Chicken recognize on the exchange?