Equipment that originally cost $1,500 with no salvage value has accumulated depreciation of $1,300. The equipment is discarded. The transaction to record the discarding of the equipment would result in a:

Question

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The book value of the equipment is the original cost ($1,500) minus accumulated depreciation ($1,300), which equals $200. Discarding the equipment with a book value of $200 and no salvage value results in a loss of $200.

Equipment That Originally Cost $1,500 with No Salvage Value Has