Question

A company decides to exchange its old machine and ¥770,000 cash for a new machine. The old machine has a book value of ¥630,000 and a fair value of ¥700,000 on the date of the exchange. The cost of the new machine would be recorded at

a. ¥1,400,000.

b. ¥1,470,000.

c. ¥1,330,000.

d. cannot be determined.

Answer

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