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On january 2 2010 rapid delivery company traded in an

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133.On January 2, 2010, Rapid Delivery Company traded in an old delivery truck for a newermodel. The exchange lacked commercial substance. Data relative to the old and newtrucks follow:Old TruckOriginal cost$24,000Accumulated depreciation as of January 2, 201016,000Average published retail value7,000New TruckList price$40,000Cash price without trade-in36,000Cash paid with trade-in30,000What should be the cost of the new truck for financial accounting purposes?a.$30,000.b.$36,000.c.$38,000.d.$40,000.10 - 30lOMoARcPSD|5958953
134.On December 1, 2010, Kelso Company acquired a new delivery truck in exchange for anold delivery truck that it had acquired in 2007. The old truck was purchased for $35,000and had a book value of $13,300. On the date of the exchange, the old truck had a fairvalue of $14,000. In addition, Kelso paid $45,500 cash for the new truck, which had a listprice of $63,000. The exchange lacked commercial substance. At what amount shouldKelso record the new truck for financial accounting purposes?
Use the following information for questions 135 and 136.A machine cost $120,000, has annual depreciation of $20,000, and has accumulateddepreciation of $90,000 on December 31, 2010. On April 1, 2011, when the machine has a fairvalue of $27,500, it is exchanged for a machine with a fair value of $135,000 and the properamount of cash is paid. The exchange has commercial substance.135.The gain to be recorded on the exchange is
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Acquisition and Disposition of Property, Plant, and Equipment136.The new machine should be recorded at
Use the following information for questions 137 and 138.Equipment that cost $81,000 and has accumulated depreciation of $30,000 is exchanged forequipment with a fair value of $48,000 and $12,000 cash is received. The exchange hascommercial substance.137.The gain to be recognized from the exchange isa.$9,000 gain.b.$6,000 gain.c.$12,000 gain.d.$21,000 gain.
138.The new equipment should be recorded at

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Term
Fall
Professor
Higgins
Tags
Depreciation, Fences, Generally Accepted Accounting Principles, Althea

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