The answer is : $0 |
Explanation : | |
Accumulated depreciation as on December 31, 2020 | 855000 |
(+) Depreciation from January 1, 2021 to April 1, 2021 [ Annual depreciation * 3/12 = 180000 * 3/12 ] | 45000 |
Accumulated depreciation as on April 1, 2021 | 900000 |
Machine cost | 1080000 |
(-) Accumulated depreciation as on April 1, 2021 | 900000 |
Book value of Machine as on April 1, 2021 | 180000 |
Fair value of machine acquired | 1215000 |
(-) Book value of Machine as on April 1, 2021 | 180000 |
Amount settled in cash | 1035000 |
Here, it is given that the proper amount of cash is paid. It means that the difference between fair value of machine acquired and the book value of Machine as on April 1, 2021 [ i.e. 1035000 ] is settled in cash and thus there is no gain or loss. |
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