Reference no: EM132170081

Questions -

Q1. Crane Company received $147000 in cash and a used computer with a fair value of $357000 from Wildhorse Co. for Crane Company's existing computer having a fair value of $504000 and an undepreciated cost of $472800 recorded on its books. The transaction has no commercial substance. How much gain should Crane recognize on this exchange, and at what amount should the acquired computer be recorded, respectively?

$1505 and $218705

$31200 and $357000

$147000 and $472800

$0 and $325800

Q2. During 2017, Bonita Industries constructed assets costing $3960000. The weighted-average accumulated expenditures on these assets during 2017 was $2370000. To help pay for construction, $1770000 was borrowed at 9% on January 1, 2017, and funds not needed for construction were temporarily invested in short-term securities, yielding $32000 in interest revenue. Other than the construction funds borrowed, the only other debt outstanding during the year was a $1910000, 10-year, 8% note payable dated January 1, 2011. What is the amount of interest that should be capitalized by Bonita during 2017?

$213300.

$106650.

$207300.

$351300.