On December 31, Strike Company sold one of its batting cages for $50,000. The equipment had an original cost of $310,000 and has accumulated depreciation of $260,000. Depreciation has been recorded up to the end of the year. What is the amount of the gain or loss on this transaction?
A) gain of $50,000
B) loss of $50,000
C) no gain or loss
D) cannot be determined

Question

Quizplus · Accepted Answer

The book value of the equipment is calculated as the original cost ($310,000) minus accumulated depreciation ($260,000), which equals $50,000. Since the equipment was sold for $50,000, which is equal to its book value, there is no gain or loss on the transaction.

On December 31, Strike Company Sold One of Its Batting