Mark Company exchanged a worn-out tractor that had cost $20, 000 and was half depreciated for a new tractor with a fair value of $12, 000.Mark paid an additional $2, 500 cash.The transaction lacked commercial substance.
Required:
Compute the amount at which Mark should record the new tractor.

Question

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The Answer of Mark Company exchanged a worn-out tractor that had cost $20, 000 and was half depreciated for a new tractor with a fair value of $12, 000.Mark paid an additional $2, 500 cash.The transaction lacked commercial substance.
Required:
Compute the amount at which Mark should record the new tractor.

Mark Company Exchanged a Worn-Out Tractor That Had Cost $20