A county acquires equipment for $500,000, for use for a community program, reported in an enterprise fund. The equipment has a 5-year life, no residual value. After 3 years, the equipment is sold for $275,000. Straight-line depreciation is used if appropriate. How is the sale reported in the enterprise fund's operating statement?

Question

Quizplus · Accepted Answer

$275,000 - (($500,000/5) x 2) = $75,000 gain

A County Acquires Equipment for $500,000, for Use for a Community