Question

Vijay sells land and receives $5,000 cash, a motorcycle worth $1,600, and two tickets to the Super Bowl with a total face value (cost) of $800 but worth $1,200. In addition, the buyer assumes the mortgage on the land of $12,000. What is Vijay's amount received in this transaction?

Answer 1

In this transaction Vijay received $19,800

Step-by-step explanation:

To get the total amount that Vijay received we have to add all the items.

Cash= $5,000

Motorcycle= $1,600

Tickets=$1,200

We consider $1,200 because we use the market price. If the buyer want to buy it in the actual market , how much he will pay?

Mortgage=$12,000

We consider the mortgage because Vijay don´t have to pay it any more , the buyer will pay it , so we don´t have the debt

So Vijay received =$5,000+$1,600+$1,200 +$12,000=$19,800