Backhoe Construction Company Recently Exchanged an Old Truck,which Cost $118,000

question 39

Multiple Choice

Backhoe Construction Company recently exchanged an old truck,which cost $118,000 and was one-third depreciated,and paid $80,000 cash for a used crane having a current fair value of $140,000.Assuming the exchange has commercial substance,at what amount should the crane be recorded on the books of Backhoe?

• A) $80,000
• B) $118,000
• C) $140,000
• D) $152,000

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Definitions:

Prices

The amount of money required to purchase a good or service, set by supply and demand dynamics in a market.

Marginal Revenue

is the additional income received from selling one more unit of a product or service.

Surround Sound Systems

Audio systems designed to create a more immersive listening experience by using multiple speakers placed around a room to simulate a 3D sound environment.

Monopoly

A market structure characterized by a single seller offering a unique product or service with no close substitutes, leading to the ability to influence price.