Melvin Motor Sales exchanged a car from its inventory for a computer to be used as a noncurrent operating asset. The following information relates to this exchange that took place on July 31, 2011:

The exchange has commercial substance.
On July 31, 2011, how much profit should Melvin recognize on this exchange?
A) $0
B) $8,000
C) $10,000
D) $13,000

Question

Melvin Motor Sales exchanged a car from its inventory for a computer to be used as a noncurrent operating asset. The following information relates to this exchange that took place on July 31, 2011:

The exchange has commercial substance.
On July 31, 2011, how much profit should Melvin recognize on this exchange?
A) $0 
B) $8,000 
C) $10,000 
D) $13,000

Quizplus · Accepted Answer

The Answer of Melvin Motor Sales exchanged a car from its inventory for a computer to be used as a noncurrent operating asset. The following information relates to this exchange that took place on July 31, 2011:

The exchange has commercial substance.
On July 31, 2011, how much profit should Melvin recognize on this exchange?
A) $0 
B) $8,000 
C) $10,000 
D) $13,000

Melvin Motor Sales Exchanged a Car from Its Inventory for a Computer