Final answer:
If a nonmonetary exchange lacks commercial substance and cash is received, no gain or loss is recognized.
The statement is False.
Step-by-step explanation:
If a nonmonetary exchange lacks commercial substance and cash is received, no gain or loss is recognized.
In accounting, a nonmonetary exchange refers to the exchange of goods or services without the involvement of cash. Commercial substance refers to the significant change in the risk, timing, or amount of future cash flows resulting from the exchange.
If a nonmonetary exchange lacks commercial substance and cash is received, the transaction would not be considered as having any gain or loss. Instead, the cash received would be considered as a partial consideration and the recognition of any gain or loss would be deferred until a later date when the transaction has commercial substance.
Answer is False.