Question: Use the information for Spencer Ltd. from BE10.12. The same used truck is being traded, but Spencer does not know the fair value of the

Use the information for Spencer Ltd. from BE10.12. The same used truck is being traded, but Spencer does not know the fair value of the new truck. Spencer did look up the value of its used truck and determined its fair value at the date of the trade is $2,000. The list price of the new truck is $36,000 and the trade-in allowance given on the trade was $5,000. If Spencer paid $31,000, what should be the amount used as the cost of the new truck? Prepare Spencer’s entry to record the exchange.

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