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:

Question

Quizplus · Accepted Answer

When a company sells an asset for more than its book value, it records the difference as a gain, increasing net income and stockholders' equity. Revenue would not be appropriate as this is not related to the primary activities of the company. Cash and accumulated depreciation represent different types of assets and would not be applicable.

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