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Dansen Co. owns a machine that has an original cost of S120,000, annual straight-line depreciation of S20,000, and it has acc

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Answer #1

Dep for three month = (20000*3/12) = 5000

Book value at the exchange date = 120000-60000-5000 = 55000

Gain (loss) = New assets value-Old asset value

                 = 132500-(77500+55000)

Gain (loss) = 0

So answer is a) $0

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