Thucydides Company purchased a new machine on May 1, 1999, for $25,000. At the time of acquisition, the machine was estimated to have a useful life of 10 years and an estimated salvage value of $1,000. The company has recorded monthly depreciation using the straight-line method. On March 1, 2008, the machine was sold for $800. What should be the loss recognized from the sale of the machine?

Question

Quizplus · Accepted Answer

[($25,000 - $1,000) × 106/120] = $21,200
[$800 - ($25,000 - $21,200)] = $3,000 loss.

Thucydides Company Purchased a New Machine on May 1, 1999