air value of P1,000,000 and carrying value of P1,200,000. DEF paid P700,000 cash to ABC. If the exchange has commercial substance, DEF would recognize gain (loss) on exchange of: 900,000 (900,000)
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ABC Company exchanged equipment with DEF Corp. The following data were available:
ABC's equipment had a carrying value of P3,500,000 and fair value of P1.875,000.
DEF's equipment has a fair value of P1,000,000 and carrying value of P1,200,000.
DEF paid P700,000 cash to ABC.
If the exchange has commercial substance, DEF would recognize gain (loss) on exchange of:
900,000
(900,000)
200,000
(200,000)
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- ABC Company exchanged equipment with DEF Corp. The following data were available: ABC's equipment had a carrying value of P3,500,000 and fair value of P1.875,000. DEF's equipment has a fair value of P1,000,000 and carrying value of P1,200,000. DEF paid P700,000 cash to ABC. If the exchange has commercial substance, ABC would capitalize the new equipment at: 300,000 1,175,000 2,575,000 3,500,000Jersey Inc. and Texas Co. have an exchange with no commercial substance. The asset given up by Jersey Inc. has a book value of $160,000 and a fair value of $200,000. The asset given up by Texas Co. has a book value of $260,000 and a fair value of $280,000. Boot of $80,000 is received by Texas Co. What amount should Jersey Inc. record for the asset received?ABC Co. traded a used equipment with a book value of P6,800 and a fair market value of P9,200 for a new similar equipment with a list price of P71,200. ABC Co. agreed to pay P52,000 in cash for the exchange in addition to giving up the used equipment. At what amount should the new equipment be recorded
- Alamos Co. exchanged equipment and $17,000 cash for similar equipment. The book value and the fair value of the old equipment were $80,700 and $90,700, respectively. Assuming that the exchange has commercial substance, Alamos would record a gain/(loss) of:Company A had a machine with a carrying amount of P450,000. Company B had a delivery vehicle with a carrying amount of P300,000. Companies A and B exchanged the machine and vehicle, and Company B paid an additional P90,000 cash as part of the exchange. Assume that the fair value of the delivery vehicle is P420,000. The exchange has commercial substance. How much gain or loss should be recorded by Company B?Bryant Inc. and Rizzo Co. have an exchange that lacks commercial substance. The asset given up by Bryant Inc. has a book value of $36,500 and a fair value of $48,000. The asset given up by Rizzo Co. has a book value of $50,000 and a fair value of $40,000. Boot of $5,000 is received by Rizzo Co. What amount should Bryant Inc. record for the asset received?
- ABC Company exchanged equipment with DEF Corp. The following data were available: ABC's equipment had a carrying value of P3,500,000 and fair value of P1.875,000. DEF's equipment has a fair value of P1,000,000 and carrying value of P1,200,000. DEF paid P700,000 cash to ABC. If the exchange LACKS commercial substance, DEF would capitalize the new equipment at: 500,000 1,000,000 1,200,000 1,900,000CAKE Corporation exchanged a piece of equipment for new equipment. Data pertaining to the old equipment follows: Cost-P500,000; Accumulated Depreciation, P300,000; Fair value of old equipment, P180,000. The fair value of the new equipment is P230,000 and CAKE Corporation paid P50,000 to complete the exchange transaction. Assuming the configuration of the cash flows of the equipment is significantly different, how much is the gain or loss on exchange?Calaveras Tire exchanged equipment for two pickup trucks. The book value and fair value of the equipment were $20,000 (original cost of $65,000 less accumulated depreciation of $45,000) and $17,000, respectively. To equalize fair values, Calaveras paid $8,000 in cash. At what amount will Calaveras value the pickup trucks? How much gain or loss will the company recognize on the exchange? Assume the exchange has commercial substance.
- Harris Ltd. exchanged a parcel of land with a carrying value of $15 million and fair value of $20million, for some highly specialized machinery from Biden Corp. In addition, Harris Ltd. alsopaid $5 million along with the land in a transaction holding commercial substance to obtain themachinery.What will be the cost of the specialized machinery in the financial statements of Harris Ltd.?ABC Co. traded a used equipment with a book value of P6,800 and a fair market value of P9,200 for a new similar equipment with a list price of P71,200. ABC Co. agreed to pay P52,000 in cash for the exchange in addition to giving up the used equipment. At what amount should the new equipment be recorded? * P71,200 P61,200 P58,800 None of the aboveHoyle Company traded machinery with a book value of $680,000 and a fair value of $720,000. In exchange, it received a machine with a fair value of $800,000. Hoyle also paid cash of $80,000 in the exchange. What amount of gain or loss should Hoyle recognize on the exchange (assuming the exchange lacks commercial substance)? Hart Corporation owns machinery with a book value of $570,000. It is estimated that the machinery will generate future cash flows of $600,000. The machinery currently has a fair value of $420,000. How much asset impairment loss should Hart recognize?