Question Details

Companies account for the exchange of nonmonetary assets 



True or false:
1.	When a company purchases land with the intention of developing it for a particular use, interest costs associated with those expenditures qualify for interest capitalization.

	2.	Assets purchased on long-term credit contracts should be recorded at the present value of the consideration exchanged.

	3.	Companies account for the exchange of nonmonetary assets on the basis of the fair value of the asset given up or the fair value of the asset received.

	4.	If a nonmonetary exchange lacks commercial substance, and cash is received, a partial gain or loss is recognized.

	5.	When a company exchanges nonmonetary assets and a loss results, the company recognizes the loss only if the exchange has commercial substance.





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