Question Details

Ecker Company purchased a new machine 



1.	Durler Company traded machinery with a book value of $180,000 and a fair value of $300,000. It received in exchange from Hoyle Company a machine with a fair value of $270,000 and cash of $30,000. Hoyle- machine has a book value of $285,000. What amount of gain should Durler recognize on the exchange?
a.	$   -0-
b.	$12,000
c.	$30,000
d.	$120,000

	2.	Hoyle Company traded machinery with a book value of $285,000 and a fair value of $270,000. It received in exchange from Durler Company a machine with a fair value of $300,000. Hoyle also paid cash of $30,000 in the exchange. Durler- machine has a book value of $285,000. What amount of gain or loss should Hoyle recognize on the exchange?
a.	$30,000 gain
b.	$  -0-
c.	$1,500 loss
d.	$15,000 loss

3.	Peterson Company purchased machinery for $160,000 on January 1, 2007. Straight-line depreciation has been recorded based on a $10,000 salvage value and a 5-year useful life. The machinery was sold on May 1, 2011 at a gain of $3,000. How much cash did Peterson receive from the sale of the machinery?
a.	$23,000
b.	$27,000
c.	$33,000
d.	$43,000

	4.	Sutherland Company purchased machinery for $320,000 on January 1, 2007. Straight-line depreciation has been recorded based on a $20,000 salvage value and a 5-year useful life. The machinery was sold on May 1, 2011 at a gain of $6,000. How much cash did Sutherland receive from the sale of the machinery?
a.	$46,000.
b.	$54,000.
c.	$66,000.
d.	$86,000.

	5.	Ecker Company purchased a new machine on May 1, 2002 for $176,000. At the time of acquisition, the machine was estimated to have a useful life of ten years and an estimated salvage value of $8,000. The company has recorded monthly depreciation using the straight-line method. On March 1, 2011, the machine was sold for $24,000. What should be the loss recognized from the sale of the machine?
a.	$0.
b.	$3,600.
c.	$8,000.
d.	$11,600.
6.	On January 1, 2002, Mill Corporation purchased for $152,000, equipment having a useful life of ten years and an estimated salvage value of $8,000. Mill has recorded monthly depreciation of the equipment on the straight-line method. On December 31, 2010, the equipment was sold for $28,000. As a result of this sale, Mill should recognize a gain of
a.	$0.
b.	$5,600.
c.	$13,600.
d.	$28,000.




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