On July 1 2022 Dillman Kennels sells equipment for $110000.The equipment originally cost $300000 had an estimated 5-year life and an expected salvage value of $50000.Accumulated Depreciation had a balance of $175000 on January 1 2022 using the straight-line method.The gain or loss on disposal is
A)$15000 gain.
B)$10000 loss.
C)$15000 loss.
D)$10000 gain.

Question

Quizplus · Accepted Answer

The book value of the equipment on July 1, 2022, is calculated as the original cost ($300,000) minus accumulated depreciation ($175,000 + $25,000 for half-year depreciation in 2022), which equals $100,000. Selling it for $110,000 results in a $10,000 gain.

On July 1 2022 Dillman Kennels Sells Equipment for $110000