Tulip Corporation purchased equipment for $ 54 comma 000on January 1, 2017. On December 31, 2019, the equipment was sold for $ 25 comma 000. Accumulated Depreciation as of December 31, 2019 was $ 28 comma 000. Calculate gain or loss on the sale.

Gain/loss = $1,000 loss

Explanation:

Giving the following information:

Original price = $54,000

Accumulated depreciation = $28,000

Seling price = $25,000

The gain or loss from selling an asset depends on the book value.

Book value = original price - accumulated depreciation

Book value = 54,000 - 28,000 = 26,000

If the selling price is higher than the book value, the company gain from the sale.

Gain/loss = 25,000 - 26,000 = $1,000 loss