Required information Complete this question by entering your answers in the tabs below.

Required $1$

Assume the fair value of the old tractor is $$28,000$ instead of $$10,400.$ What is the amount of gain or loss that Kapono would

recognize on the exchange? What is the initial value of the new tractor?

Gain on exchange of assets

Initial value of new tractor

$[$The following information applies to the questions displayed below.$]$

Case A$.$ Kapono Farms exchanged an old tractor for a newer model. The old tractor had a book value of $$19,000($original

cost of $$42,000$ less accumulated depreciation of $$23,000)$ and a fair value of $$10,400.$ Kapono paid $$34,000$ cash to

complete the exchange. The exchange has commercial substance.

Case B$.$ Kapono Farms exchanged $100$ acres of farmland for similar land. The farmland given had a book value of

$$570,000$ and a fair value of $$840,000.$ Kapono paid $$64,000$ cash to complete the exchange. The exchange has

commercial substance.

Required:

What is the amount of gain or loss that Kapono would recognize on the exchange? What is the initial value of the new tractor?

Assume the fair value of the old tractor is $$28,000$ instead of $$10,400.$ What is the amount of gain or loss that Kapono would

recognize on the exchange? What is the initial value of the new tractor?

Complete this question by entering your answers in the tabs below.

Required $1$

Required $2$

What is the amount of gain or loss that Kapono would recognize on the exchange? What is the initial value of the new tractor?

Loss on exchange of assets

Initial value of new tractor