A fixed asset with a cost of $30,000 and accumulated depreciation of $25,000 is sold for $3,500. What is the amount of gain or loss on disposal of the fixed asset?
A) $2,500 loss
B) $1,500 loss
C) $2,500 gain
D) $1,500 gain

Question

Quizplus · Accepted Answer

To calculate the gain or loss on disposal of a fixed asset, you need to subtract the accumulated depreciation from the cost to get the asset's book value. In this case: $30,000 - $25,000 = $5,000. Then, you subtract the sale price from the book value: $5,000 - $3,500 = $1,500 loss. Therefore, the correct answer is B, $1,500 loss.

A Fixed Asset with a Cost of $30,000 and Accumulated