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Topic
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Ace Corp. entered into a troubled debt restructuring agreement with National Bank. National agreed to accept land with a carrying amount of $75,000 and a fair value of $100,000 in payment and cancellation of a note (from Ace) with a carrying amount of $150,000. Disregarding income taxes, what amount should Ace report as a gain in its income statement?
A.
$0
B.
$25,000
C.
$50,000
Incorrect
$75,000
This seems like an easy one right? 75k? No, the answer was 50k. Why? (I don’t agree)
FAR 7/11/16 - 87
BEC 9/9/16
REG TBD
AUD TBD
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