|Posted: 12 Apr 2010 at 13:22 | IP Logged
Scott Co.exchanged similar nonmonetary asset with Dale Co. No cash was exchanged .The carrying amount of asset surrendered by scott exceded both thr fair value of asset received and Dale's carrying amount of that asset.If the transaction lacks commercial substance, Scott should recognize the difference betweent he carrying amount of asset it surrendered and
-fair value of asset it received as a loss
-fair value of asset it received as a gain
-dale's carrying amount of asset it received as a loss
- dale's carrying amount of asset it received as a gain.
Correct answer is 'a'.
I thought the exchange transaction which lacks commercial substance are recognized at book value. IS IT BEACAUSE THIS IS THE BEST ASNWER AS THERE IS NO ANSWER WITH CARRYING VALUE OF SCOTT...