X COMPANY Y COMPANY Equipment Cost 50,000 40,000 Acc. Depreciation 20,000 30,000 Fair value of Equipment 12,000 16,000 Cash Given Up 4,000 X Company exchanged Equipment with Y Company (in an exchange with commercial substance). The summary information with respect to the exchange is shown in the table above: The Gain or Loss on Disposal for X Company is: Select one: O a. Loss of $12,000 O b. Loss of $14,000 O c. Gain of $14,000 O d. None of the these answers O e. Gain of $12,000

X COMPANY Y COMPANY Equipment Cost 50,000 40,000 Acc. Depreciation 20,000 30,000 Fair value of Equipment 12,000 16,000 Cash Given Up 4,000 X Company exchanged Equipment with Y Company (in an exchange with commercial substance). The summary information with respect to the exchange is shown in the table above: The Gain or Loss on Disposal for X Company is: Select one: O a. Loss of $12,000 O b. Loss of $14,000 O c. Gain of $14,000 O d. None of the these answers O e. Gain of $12,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Item 22 Below is information relative to an exchange of similar assets by a company. Assume the exchange has commercial substance. Old Equipment Cash Book Value Fair Value Paid $ 49,700 $ 60,500 $ 14,100 The company would record the new equipment at:
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