Allen Inc. exchanged land and cash of $4,500 for similar land. The book value and...
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Allen Inc. exchanged land and cash of $4,500 for similar land. The book value and the fair value of the old land were $89,900 and $100,100, respectively. Assuming that the exchange lacks commercial substance, Allen would record equipmentnew and a gain/(loss) on exchange of assets in the amounts of:
| Land | Gain/(loss) | ||||||
| a. | $ | 104,600 | $ | 0 | |||
| b. | $ | 104,600 | $ | 10,200 | |||
| c. | $ | 94,400 | $ | 0 | |||
| d. | $ | 94,400 | $ | 10,200 | |||
Multiple Choice
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Option A
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Option D
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Option C
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Option B
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