1. Bogus Co. exchanged Building 42 which has an appraised value of $4,800,000, a
ID: 2415961 • Letter: 1
Question
1. Bogus Co. exchanged Building 42 which has an appraised value of $4,800,000, a cost of $7,590,000, and accumulated depreciation of $3,600,000 for Building X belonging to Good Co. Building X has an appraised value of $4,512,000, a cost of $9,030,000, and accumulated depreciation of $4,752,000. The correct amount of cash was also paid. Assume depreciation has already been updated. What gain or loss did Bogus recognize on the exchange, assuming no commercial substance?
48,600 loss
24,000 gain
0 gain/loss
None of the above
Explanation / Answer
The amount of gain that Bogus should recognise = Appraised value-Net cost = 4800000-(7590000-3600000)=810000 gain
Hence the answer is none of the above
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.