On January 1, 2002, Buccaro Corporation purchased for $76,000, equipment having a useful life of ten years and an estimated residual value of $4,000.Flynn has recorded monthly depreciation of the equipment on the straight-line method.On December 31, 2010, the equipment was sold for $14,000.As a result of this sale, Flynn should recognize a gain of

Question

Quizplus · Accepted Answer

The equipment was sold for $14,000, which is $2,800 more than its book value of $11,200 ($76,000 - $64,800). Therefore, Flynn should recognize a gain of $2,800 on the sale of the equipment.

On January 1, 2002, Buccaro Corporation Purchased for $76,000, Equipment