Adam Company sells a plant asset that originally cost $180,000 for $60,000 on December 31, 2019. The accumulated depreciation account had a balance of $90,000 after the current year's depreciation had been recorded.
The company should recognize a:

Question

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The book value of the asset at the time of disposal is calculated as the original cost ($180,000) minus the accumulated depreciation ($90,000), which equals $90,000. Selling the asset for $60,000, which is $30,000 less than its book value, results in a $30,000 loss on disposal.

Adam Company Sells a Plant Asset That Originally Cost $180,000