Clark Imports sold a depreciable plant asset for cash of $35,000.The accumulated depreciation amounted to $70,000,and a loss of $5,000 was recognized on the sale.Under these circumstances,the original cost of the asset must have been:

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Quizplus · Accepted Answer

The original cost of the asset is calculated by adding the accumulated depreciation and the book value at the time of sale. The book value is the sale price minus the loss. So, $35,000 (sale price) + $5,000 (loss) = $40,000 (book value). Adding the accumulated depreciation of $70,000 gives $110,000 as the original cost.

Clark Imports Sold a Depreciable Plant Asset for Cash of $35,000.The