Financial accounting 16th Edition by Jan Williams,Susan Haka,Mark Bettner ,Joseph Carcello

Exercise 26

Alexander Company purchased a piece of equipment for $14,000 and depreciated it for three years over a five-year estimated life with an expected residual value at the end of five years of $2,000.t the end of the third year, Alex decided to upgrade to equipment with increased capacity and sold the original piece of equipment for $7,500.alculate the gain or loss on the disposal at the end of the third year.