HOT Company exchanges an automobile machine with a carrying amount of $135,000 ( original cost , $550,000) for a molding machine owned by Water Company. The molding machine is carried in Water's Company books at a cost of $240,000 with an accumulated depreciation of $83,000 at the time of exchange. Assume that the fair values of the automobile and the molding machine are $145,000 and $150,000, respectively. In addition, HOT Company paid $5,000 to Water Company to complete the transaction. How much is the gain or loss on the exchange to be recognized by Water Company?
HOT Company exchanges an automobile machine with a carrying amount of $135,000 ( original cost , $550,000) for a molding machine owned by Water Company. The molding machine is carried in Water's Company books at a cost of $240,000 with an accumulated depreciation of $83,000 at the time of exchange. Assume that the fair values of the automobile and the molding machine are $145,000 and $150,000, respectively. In addition, HOT Company paid $5,000 to Water Company to complete the transaction. How much is the gain or loss on the exchange to be recognized by Water Company?
Chapter14: Property Transact Ions: Capital Gains And Losses, § 1231, And Recapture Provisions
Section: Chapter Questions
Problem 37CE
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HOT Company exchanges an automobile machine with a carrying amount of $135,000 ( original cost , $550,000) for a molding machine owned by Water Company. The molding machine is carried in Water's Company books at a cost of $240,000 with an
Assume that the fair values of the automobile and the molding machine are $145,000 and $150,000, respectively. In addition, HOT Company paid $5,000 to Water Company to complete the transaction.
How much is the gain or loss on the exchange to be recognized by Water Company?
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