On January 1, 2020, Kingbird Corporation sold a building that cost $257,510 and that had accumulated depreciation of $102,150 on the date of sale. Kingbird received as consideration a $247,510 non-interest-bearing note due on January 1, 2023. There was no established exchange price for the building, and the note had no ready market. The prevailing rate of interest for a note of this type on January 1, 2020, was 11%. At what amount should the gain from the sale of the building be reported?
On January 1, 2020, Kingbird Corporation sold a building that cost $257,510 and that had accumulated depreciation of $102,150 on the date of sale. Kingbird received as consideration a $247,510 non-interest-bearing note due on January 1, 2023. There was no established exchange price for the building, and the note had no ready market. The prevailing rate of interest for a note of this type on January 1, 2020, was 11%. At what amount should the gain from the sale of the building be reported?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On January 1, 2020, Kingbird Corporation sold a building that cost $257,510 and that had
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