On January 2, 2020, Neeson Delivery Company traded in an old delivery truck for a newer model. Data relative to the old and new trucks follow: Old Truck
Original cost.....................................................................$9,000
Accumulated depreciation at January 2,2020...................6,000
Fairvalue ...........................................................................3,000
New Truck
List price..........................................................$\$ 15,000$
Cash price without trade-in..............................14,000
Cash paid with trade-in.....................................11,000 The cost of the new truck for financial accounting purposes is
A) $ 9,000.
B) $ 11,000.
C) $ 14,000.
D) $ 15,000.

Question

On January 2, 2020, Neeson Delivery Company traded in an old delivery truck for a newer model. Data relative to the old and new trucks follow: Old Truck
Original cost.....................................................................$9,000
Accumulated depreciation at January 2,2020...................6,000
Fairvalue ...........................................................................3,000
 New Truck
List price..........................................................$\$ 15,000$
Cash price without trade-in..............................14,000
Cash paid with trade-in.....................................11,000 The cost of the new truck for financial accounting purposes is
A) $ 9,000.
B) $ 11,000.
C) $ 14,000.
D) $ 15,000.

Quizplus · Accepted Answer

The cost of the new truck is the cash price without trade-in, which is $14,000.

On January 2, 2020, Neeson Delivery Company Traded in an Old