A plant asset cost $95400 when it was purchased on January 1, 2014. It was depreciated by the straight-line method based on a 9-year life with no salvage value. On June 30, 2021, the asset was discarded with no cash proceeds. What gain or loss should be recognized on the retirement? No gain or loss. $21200 loss. $15900 loss. $10600 gain. A quick response will be appreciated
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
A plant asset cost $95400 when it was purchased on January 1, 2014. It was
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