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4 February, 10:55

Equipment originally costing $65,000 has accumulated depreciation of $25,000. If the equipment is sold for $30,000, the company should record: Multiple Choice A gain of $10,000. A loss of $10,000. A loss of $35,000. No gain or loss.

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  1. 4 February, 13:40
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    The correct answer is B.

    Explanation:

    Giving the following information:

    Equipment originally costing $65,000 has accumulated depreciation of $25,000. The equipment is sold for $30,000.

    An asset provides gain or loss depending if the selling price is higher or lower the book value.

    Book value = Purchasing price - accumulated depreciation

    Book value = 65,000 - 25,000 = $40,000

    Gain or loss from selling the equipment = selling price - book value

    Loss from selling the equipment = 30,000 - 40,000 = - $10,000
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