Mariot trades in its old equipment (with the following carrying values) for new equipment. Mariot received $4,000 cash on the exchange. The fair value of the new equipment is $14,000. Original cost of old equipment: $10,000 Accumulated Depreciation on old equipment: $6,000 If the transaction lacks commercial substance, what amount does Mariot assign to the new equipment?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Mariot trades in its old equipment (with the following carrying values) for new equipment. Mariot received $4,000 cash on the exchange. The fair value of the new equipment is $14,000.
Original cost of old equipment : $10,000
Accumulated Depreciation on old equipment: $6,000
If the transaction lacks commercial substance, what amount does Mariot assign to the new equipment?
Transcribed Image Text:Mariot trades in its old equipment (with the following carrying values) for new equipment. Mariot received $4,000 cash on the exchange. The fair value of the new equipment is $14,000. Original cost of old equipment : $10,000 Accumulated Depreciation on old equipment: $6,000 If the transaction lacks commercial substance, what amount does Mariot assign to the new equipment?
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