A fixed asset with a cost of $52,000 and accumulated depreciation of $47,500 is traded for a similar asset priced at $60,000 fair market value in a transaction with commercial substance.Assuming a trade-in allowance of $5,000,at what cost will the new equipment be recorded in the books?
A)$60,500
B)$60,000
C)$54,000
D)$59,500

Question

Quizplus · Accepted Answer

The new equipment will be recorded at its fair market value, which is $60,000.

A Fixed Asset with a Cost of $52,000 and Accumulated