A fixed asset with a cost of $41,000 and accumulated depreciation of $36,000 is traded for a
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Question:
A fixed asset with a cost of $41,000 and accumulated depreciation of $36,000 is traded for a similar asset priced at $50,000 (fair market value) in a transaction with commercial substance. Assuming a trade-in allowance of $4,000, at what cost will the new equipment be recorded in the books?
a. $45,000
b. $51,000
c. $54,000
d. $50,000
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