How much profit should melvin recognize on this exchange

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Question - Melvin Motor Sales exchanged a car from its inventory for a computer to be used as a noncurrent operating asset. The following information relates to this exchange that took place on July 31, 2011:

Carrying amount of the car $30,000

Listed selling price of the car $45,000

Fair Value of the Computer $43,000

Cash difference paid b Melvin Motor $5,000

The exchange has commercial substance.

On July 31, 2011, how much profit should Melvin recognize on this exchange?

Reference no: EM131800538

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