Caine Company exchanged a car from inventory for a computer to be used as a long-term asset. The following information relates to this exchange: Carrying amount of the car, 600,000List selling price of the car, 900,000’ Fair value of the computer, 860,000’; Cash difference paid by Caine, 100,000. What is the cost of the computer acquired in exchange

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Caine Company exchanged a car from inventory for a computer to be used as a long-term asset. The following information relates to this exchange: Carrying amount of the car, 600,000List selling price of the car, 900,000’ Fair value of the computer, 860,000’; Cash difference paid by Caine, 100,000. What is the cost of the computer acquired in exchange?
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Caine Company exchanged a car from inventory for a computer to be used as a long-term asset. The following information relates to this exchange: Carrying amount of the car, 600,000List selling price of the car, 900,000’ Fair value of the computer, 860,000’; Cash difference paid by Caine, 100,000. What is the cost of the computer acquired in exchange?

 

 

1. Indicate the appropriate entries requires for each of the transactions. 

2. Will Caine company declare a gain or loss on this transaction?

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Follow-up Question

1. Indicate the appropriate entries requires for each of the transactions. 

2. Will Caine company declare a gain or loss on this transaction?

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