merrymerry
Dec 16, 2007, 05:54 PM
Melvin Motor Sales exchanged a car from its inventory for a computer to be used as a noncurrent operating asset. The following information relates to this exchange that took place on July 31, 2008:
Carrying amount of the car ............................ $30,000
Listed selling price of the car ....................... 45,000
Fair value of the computer ............................ 43,000
Cash difference paid by Melvin ........................ 5,000
Would the answer be zero? The listed selling price of the car plus the cash difference pd minus the fair value of the computer 45,000+5000-43,000=loss of 7,000
or would it be a profit of 8,000 the Fair value of computer minus carrying amount of car+cash difference pd 43,000-30,000-5,000=8,000
Carrying amount of the car ............................ $30,000
Listed selling price of the car ....................... 45,000
Fair value of the computer ............................ 43,000
Cash difference paid by Melvin ........................ 5,000
Would the answer be zero? The listed selling price of the car plus the cash difference pd minus the fair value of the computer 45,000+5000-43,000=loss of 7,000
or would it be a profit of 8,000 the Fair value of computer minus carrying amount of car+cash difference pd 43,000-30,000-5,000=8,000