A company had a bulldozer destroyed by a fire. The bulldozer originally cost $120,000. The accumulated depreciation on it was $57,500. The proceeds from the insurance company were $87,500. The company should recognize: a. a gain of $87,500 b. a loss of $62,500 c. a gain of $25,000 d. a gain of $62,500 e. a loss of $25,000
A company had a bulldozer destroyed by a fire. The bulldozer originally cost $120,000. The accumulated depreciation on it was $57,500. The proceeds from the insurance company were $87,500. The company should recognize: a. a gain of $87,500 b. a loss of $62,500 c. a gain of $25,000 d. a gain of $62,500 e. a loss of $25,000
Chapter2: Income Tax Concepts
Section: Chapter Questions
Problem 59P
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Transcribed Image Text:A company had a bulldozer destroyed by a fire. The bulldozer
originally cost $120,000. The accumulated depreciation on it was
$57,500. The proceeds from the insurance company were
$87,500. The company should recognize:
a. a gain of $87,500
b. a loss of $62,500
c. a gain of $25,000
d. a gain of $62,500
e. a loss of $25,000
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