On December 31, Strike Company has decided to sell one of its batting cages. The initial cost of the equipment was $215,000 with an accumulated depreciation of $185,000. Depreciation has been taken up to the end of the year. The company found a company that is willing to buy the equipment for $30,000. What is the amount of the gain or loss on this transaction?
A) Gain of $30,000
B) Loss of $30,000
C) No gain or loss
D) Cannot be determined

Question

Quizplus · Accepted Answer

The book value of the equipment is $215,000 - $185,000 = $30,000. Since the selling price is also $30,000, there is no gain or loss on the transaction.

On December 31, Strike Company Has Decided to Sell One