Gilly Construction trades in an old tractor for a new tractor, receiving a $29,000 trade-in allowance and paying the remaining $83,000 in cash. The old tractor had cost $96,000 and had accumulated depreciation of $52,500. 1. What is the book value of the old tractor at the time of exchange? 2. What is the loss on this asset exchange? 3. What amount should be recorded (debited) in the asset account for the new tractor?
Gilly Construction trades in an old tractor for a new tractor, receiving a $29,000 trade-in allowance and paying the remaining $83,000 in cash. The old tractor had cost $96,000 and had accumulated depreciation of $52,500. 1. What is the book value of the old tractor at the time of exchange? 2. What is the loss on this asset exchange? 3. What amount should be recorded (debited) in the asset account for the new tractor?
Chapter11: Property Dispositions
Section: Chapter Questions
Problem 64P
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Transcribed Image Text:Gilly Construction trades in an old tractor for a
new tractor, receiving a $29,000 trade-in
allowance and paying the remaining $83,000
in cash. The old tractor had cost $96,000 and
had accumulated depreciation of $52,500.
1. What is the book value of the old tractor at
the time of exchange?
2. What is the loss on this asset exchange?
3. What amount should be recorded (debited)
in the asset account for the new tractor?
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