Sheffield Corporation purchased equipment on January 1, Year 1 for $100,000. Sheffield used the straight-line method of depreciation with a $12,000 salvage value and a useful life of 5 years. On January 1, Year 3 Sheffield sold this equipment for $70,000.
Required:
Calculate the gain or loss Sheffield should recognize from this sale.

Question

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The Answer of Sheffield Corporation purchased equipment on January 1, Year 1 for $100,000. Sheffield used the straight-line method of depreciation with a $12,000 salvage value and a useful life of 5 years. On January 1, Year 3 Sheffield sold this equipment for $70,000.
Required:
Calculate the gain or loss Sheffield should recognize from this sale.

Sheffield Corporation Purchased Equipment on January 1, Year 1 for $100,000