RJ owns a used crane that was originally purchased on August 1, 2012, for $180,000. Straight-line monthly amortization has been recorded on the basis of an estimated useful life of 5 years and no residual value. On January 31, 2015, RJ sold the crane for $92,000 cash. The pre-tax gain (loss) on the disposal was:

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The crane was depreciated over 5 years, which is 60 months. Monthly depreciation is $3,000 ($180,000 / 60). By January 31, 2015, 30 months of depreciation have occurred, totaling $90,000 (30 x $3,000). The book value of the crane at the time of sale is $90,000 ($180,000 - $90,000). Selling it for $92,000 results in a $2,000 gain ($92,000 - $90,000).

RJ Owns a Used Crane That Was Originally Purchased on August