Equipment that cost $54,000 and on which $30,000 of accumulated depreciation has been recorded was disposed of for $27,000 cash. The entry to record this event would include a
A) gain of $3,000.
B) loss of $3,000.
C) credit to the Equipment account for $9,000.
D) credit to Accumulated Depreciation for $30,000.

Question

Quizplus · Accepted Answer

The book value of the equipment is $24,000 ($54,000 cost - $30,000 accumulated depreciation). Selling it for $27,000 results in a gain of $3,000 ($27,000 - $24,000).

Equipment That Cost $54,000 and on Which $30,000 of Accumulated