When an Asset Is Exchanged for a Similar Asset and a Gain

question 23

Multiple Choice

When an asset is exchanged for a similar asset and a gain results, under accounting rules the gain is:

• A) credited to Gain on Exchange of an Asset.
• B) recorded in the other income section of the income statement.
• C) absorbed into the cost of the new asset.
• D) subtracted from the cost of the new asset.

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Definitions:

Hands-on Experience

Direct involvement in performing tasks or activities, providing practical experience rather than theoretical knowledge.

Auditory

Pertaining to the sense of hearing, including the abilities to hear, listen, and process sounds.

Visual

Relating to seeing or sight, often used in the context of learning styles that prefer imagery and spatial understanding.

Cultural Competence

The ability to understand, appreciate, and interact effectively with people of different cultures and socio-economic backgrounds.