On July 1, 2015, Happy Hound Kennels Inc.sells equipment for $20,000.The equipment originally cost $80,000, had an estimated 5-year life and an expected residual value of $10,000.The Accumulated Depreciation account had a balance of $49,000 on January 1, 2015, using the straight-line method.The gain or loss on disposal is

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The book value of the equipment on July 1, 2015, is $80,000 (original cost) - $49,000 (accumulated depreciation) - $6,000 (additional depreciation for half a year) = $25,000. Selling it for $20,000 results in a $5,000 loss.