A truck costing $75000 and on which $65000 of accumulated depreciation has been re-corded was discarded as having no value.Recording this event would include a(n)
A)gain of $10000.
B)loss of $10000.
C)increase to Accumulated Depreciation for $65000.
D)increase to Accumulated Depreciation for $75000.

Question

Quizplus · Accepted Answer

When a truck is discarded and has no value left, it means that the total accumulated depreciation on the truck is more than its original cost. In this case, accumulated depreciation is $65,000 which is higher than the original cost of the truck that is $75,000. Hence, there is a loss of $10,000 which needs to be recorded.

A Truck Costing $75000 and on Which $65000 of Accumulated