A book manufacturing company sells equipment for $450,000 when the book value of the equipment is $400,000.The company would record the extra $50,000 as:
A)a gain,increasing net income and stockholders' equity.
B)revenue,increasing net income and stockholders' equity.
C)expenses,decreasing net income and stockholders' equity.
D)a loss,decreasing net income and stockholders' equity.

Question

Quizplus · Accepted Answer

The extra $50,000 would be recorded as a gain, which would increase net income and stockholders' equity. This is because the company sold the equipment for more than its book value, resulting in a profit.

A Book Manufacturing Company Sells Equipment for $450,000 When the Book