Answered: A fixed asset with a cost of $31,365.00…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Question

A fixed asset with a cost of $31,365.00 and accumulated depreciation of $28,228.50 is sold for $5,332.05. What is the amount of the gain or loss on disposal of the fixed asset?

Select the correct answer.

$3,136.50 loss

$2,195.55 loss

$2,195.55 gain

$3,136.50 gain

Expert Solution

Step 1

Given cost of asset = $31,365

Accumulated depreciation = $28,228.5

Therefore carrying value = Cost of asset - accumulated depreciation = 31,365 - 28,228.5 = $3,136.5

Sale value = $5,332.05

Therefore gain on sale = Sale value - carrying value = 5,332.05 - 3,136.5 = $2,195.55 gain

Step by step

Solved in 2 steps

Knowledge Booster

Accounting for Property, Plant and Equipment

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions