Albatross Services scrapped a van.The van originally cost $40 000,had an estimated residual value of zero and an estimated life of 10 years.At the time it was scrapped,it had accumulated depreciation of $40 000.What was the effect of scrapping the van?

Question

Quizplus · Accepted Answer

Since the van had already accumulated depreciation of $40,000, the company had fully depreciated the asset, and there was no value left to be gained or lost. Scrapping the van would neither result in a gain nor loss. Therefore, the answer is D, no gain or loss.

Albatross Services Scrapped a Van