Computer equipment used in the business office of a not-for-profit organization was sold for $9,000. The original cost of the equipment had been $21,000 and there was $15,000 of accumulated depreciation as of the date of sale. How will the gain be reported?

Question

Quizplus · Accepted Answer

The gain on the sale of equipment is calculated as the sale price ($9,000) minus the equipment's net book value ($21,000 - $15,000 = $6,000). The gain of $3,000 is an unrestricted gain because it is not subject to any donor restrictions on how it may be used.

Computer Equipment Used in the Business Office of a Not-For-Profit