Aye Company owns an equipment with carrying amount of P2,000,000 and fair value of P2,500,000on the date of exchange. Bee Company also owns an equipment with carrying amount of P3,200,000 and fair value of P3,500,000 on the date of exchange. On the date of exchange, Aye Company exchanged its equipment and paid P1,000,000 for the equipment owned by Bee Company. The configuration of cash flows from the equipment acquired is expected to be significantly different from the configuration of cash flows of the equipment exchanged.•At what amount should Aye Company record the equipment acquired in exchange?•What amount of gain on exchange should be recognized by Aye Company?•At what amount should Bee Company record the equipment acquired in exchange?
Aye Company owns an equipment with carrying amount of P2,000,000 and fair value of P2,500,000on the date of exchange. Bee Company also owns an equipment with carrying amount of P3,200,000 and fair value of P3,500,000 on the date of exchange. On the date of exchange, Aye Company exchanged its equipment and paid P1,000,000 for the equipment owned by Bee Company. The configuration of
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