Homework Answers
Answer:A.$48000
The gain to be recognized from the exchange :
[(Cash Received / (Cash received + fair value)] x [(Fair Value + Cash received - (Equipment cost - Accum. Depreciation)]
[(120000 / ( 120000 + 480000 )] x [ (480000 + 120000 - (660000 - 300000 ) ] = 0.20 x 240000 = 48000
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