Equipment to be sold has a book value of $4,000.The cost of the equipment is $10,000.The cash received at sale is $2,000.What is the gain or loss on disposal of the equipment?
A) loss on disposal of $2,000
B) loss on disposal of $4,000
C) loss on disposal of $6,000
D) gain on disposal of $2,000

Question

Quizplus · Accepted Answer

The loss on disposal is calculated as the book value minus the cash received: $4,000 - $2,000 = $2,000 loss.

Equipment to Be Sold Has a Book Value of $4,000