Alamos Co. exchanged equipment and $18,000 cash for similar equipment. The book value and the fair value of the old equipment were $82,000 and $90,000, respectively.
- Assuming that the exchange has commercial substance, Alamos would record a gain/(loss) of:

Question

Quizplus · Accepted Answer

$\begin{array}{|l|c|c|}
\hline \text { Equipment-new }(\mathrm{FV} \text { of old }+\$ 18,000) & 108,000 & \
\hline \text { Cash } & & 18,000 \
\hline \text { Equipment-old (book value) } & & 82,000 \
\hline \text { Gain }(\$ 90,000-82,000) & & 8,000 \
\hline
\end{array}$

Alamos Co Exchanged Equipment and $18,000 Cash for Similar Equipment