Horton Stores exchanged land and cash of $4,400 for similar land. The book value and the fair value of the land were $90,000 and $100,400, respectively. Assuming that the exchange has commercial substance, Horton would record land-new and a gain/(loss) of: Land Gain/Loss A. $94,400 $10,400 B. $104,800 $0 C. $94,400 $0 D. $104,800 $10,400
Horton Stores exchanged land and cash of $4,400 for similar land. The book value and the fair value of the land were $90,000 and $100,400, respectively. Assuming that the exchange has commercial substance, Horton would record land-new and a gain/(loss) of: Land Gain/Loss A. $94,400 $10,400 B. $104,800 $0 C. $94,400 $0 D. $104,800 $10,400
Chapter12: Nonrecognition Transactions
Section: Chapter Questions
Problem 21P
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Transcribed Image Text:Horton Stores exchanged land and cash of $4,400 for similar
land. The book value and the fair value of the land were
$90,000 and $100,400, respectively. Assuming that the
exchange has commercial substance, Horton would record
land-new and a gain/(loss) of:
Land
Gain/Loss
A. $94,400 $10,400
B. $104,800 $0
C. $94,400 $0
D. $104,800 $10,400
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