China Inn and Midwest Chicken exchanged assets. China Inn received a delivery truck and gave equipment. The fair value and book value of the equipment were $ 22,000 and $ 12,000 (original cost of $ 45,000 less accumulated depreciation of $ 33,000), respectively. To equalize market values of the exchanged assets, China Inn paid $ 9,000 in cash to Midwest Chicken. At what amount did China Inn record the delivery truck? How much gain or loss did China Inn recognize on the exchange?
Answer to relevant QuestionsChina Inn and Midwest Chicken exchanged assets. Midwest Chicken received equipment and gave a delivery truck. The fair value and book value of the delivery truck given were $ 31,000 and $ 32,600 (original cost of $ 37,000 ...The Donut Stop purchased land and a building for $ 2 million. To maximize the company’s tax deduction for depreciation, management allocated only 10% of the purchase price to land and 90% of the purchase price to the ...Speedy Delivery Company purchases a delivery van for $ 36,000. Speedy estimates that at the end of its four-year service life, the van will be worth $ 6,400. During the four-year period, the company expects to drive the van ...Brad’s BBQ reported sales of $ 735,000 and net income of $ 28,000 in its 2015 income statement. Brad’s also reported total assets of $ 496,000 in its 2015 balance sheet and $ 389,000 in its 2014 balance sheet. Required: ...Speedy Delivery Company purchases a delivery van for $40,000. Speedy estimates that at the end of its five-year service life, the van will be worth $10,000. During the five-year period, the company expects to drive the van ...
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