In an exchange of plant assets, Transit Co. received equipment with a fair value equal to the carrying amount of equipment given up. Transit also contributed cash.
The exchange lacks commercial substance.
As a result of the exchange, Transit recognized
A. A loss equal to the cash given up.
B. A loss determined by the proportion of cash paid to the total transaction value.
C. A gain determined by the proportion of cash paid to the total transaction value.
D. Neither gain nor loss.