Question

A copy machine cost $ 45 comma 000 when new and has accumulated depreciation of $ 44 comma 000. Suppose Print and Photo Center sold the machine for $ 1 comma 000. What is the result of this disposal​ transaction? A. Loss of $ 1 comma 000 B. Gain of $ 1 comma 000 C. Loss of $ 44 comma 000 D. No gain or loss

Answer 1

Answer:

The disposal resulted was at D. No gain or loss

Explanation:

The gain or loss on disposal on a fixed asset is calculated by comparing the sales proceeds from disposing off the asset and the carrying value of the asset.

The carrying value of the asset is its net book value which is calculated as follows,

Carrying value = Cost - Accumulated depreciation

If the carrying value is equal to the sales proceeds from disposal, there is no gain or loss.

The carrying value of copy machine was = 45000  -  44000  =  $1000

The sales proceeds were also $1000

Thus, gain/loss on disposal = 1000 - 1000 = $0

Thus, there was no gain or loss on disposal.

Answer 2

Answer:

B

Explanation:

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