Answer:
$4,000
Explanation:
The computation of the recognized gain or loss on the exchange is as follows:
Here the cash received is of $8,000 and the realized gain is
= Fair market value - exchanged value
= $38,000 - $34,000
= $4,000
Now the amount that should be recorded by considering the lesser amount of the realized gain or the cash received
As it can be seen that the $4,000 is lesser amount as compared with the $8,000
So $4,000 would be recognized gain or loss
