A and B have an exchange with no commercial substance. The equipment given up by A has

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A and B have an exchange with no commercial substance. The equipment given up by A has a historical cost of $750,000, accumulated depreciation of $426,000, and a fair value of $405,000.The equipment given up by B has a historical cost of $810,000, accumulated depreciation of $330,000, and a fair value of $513.000. A also gives B $108,000 in cash. Answer the questions below for B.

Required

Part 1: Is there a gain or loss on the asset that B is disposing of and how much is it?

Part 2: At the date of the exchange, will the gain or loss be recognized by B? Why?

Part 3: Prepare the journal entry to record the exchange for B.

Related Book For answer-question

Operating Systems Internals and Design Principles

ISBN: 978-0133805918

8th edition

Authors: William Stallings

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Posted Date: Jan 30, 2022 10:37 PM

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A and B have an exchange with no commercial substance. The equipment given up by A has

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Operating Systems Internals and Design Principles

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