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Ok, so I thought I had it, got 11/13 questions correct the first time through the becker questions, but I still have a few remaining questions, I’m not sure if I confused myself.
1. For less than 25% Rule, (Boot/Total Consideration). Is total consideration (Boot + FV of Asset Rec’d)? Becker F-2 pg. 39 doesn’t make it very clear since Machine B + Boot Rec’d = $12,000 and FV of Machine A also = $12,000. Not sure if the fact that (FV Given = FV Rec’d) comes into play. I’m trying to break down the formula as much as I can to understand it. In other questions does the FV of the old asset usually = the FV of the new + Boot?
2. Question 12/13 has me off my rocker. It appears someone else posted this question in another forum and rec’d 2 contradictory answers. If the exchange lacks commercial substance and boot is paid is that end of story? Or if boot is rec’d OR PAID (becker only states rec’d) and over 25% it bumps directly to a monetary exchange and full G/L is recognized? Also, in that question they are saying total consideration = Boot + FV of OLD ASSET, whereas I believed it was supposed to be BOOT + FV OF NEW ASSET.
I have surely confused the hell out of myself, but want to master this topic since I believe I may see it on my upcoming test. Please help me. Jeff, maybe you have some input??
Thank you!
a-pass
b-pass
r-pass
f-pass
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