An Entity Acquired an Item of Plant in Exchange for an Item

question 33

Multiple Choice

An entity acquired an item of plant in exchange for an item of equipment. The equipment has a carrying amount of $15 000 and a fair value of $20 000. The journal entry to record the acquisition of the plant will show:

• A) a loss on acquisition of $5000.
• B) a gain on sale of $5000.
• C) proceeds on sale of equipment of $15 000.
• D) proceeds on sale of plant of $15 000.

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Definitions:

Client-visits

The act of meeting with clients or potential clients, often for the purposes of discussing business opportunities, providing services, or strengthening relationships.

Activity Variance

The difference between the budgeted and actual amount of an activity, such as hours worked or units produced, affecting budget and cost planning.

Budgeting

A financial planning process that involves the estimation of future revenues and expenses over a specified period.

Personnel Expenses

Costs associated with employing staff, including wages, benefits, and taxes.