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QUESTION 1 Road Cruncher Inc. purchased a new backhoe to dig up old roads on January...

QUESTION 1

Road Cruncher Inc. purchased a new backhoe to dig up old roads on January 1st, 2016 for $728,000. Road Cruncher Inc. estimated that the backhoe had an estimated useful life of 8 years and that it had a residual value of $50,000.

1) Using straight-line depreciation, what will yearly depreciation expense be for the backhoe? (enter number only, no commas)

QUESTION 2

Use the same information as in #1

2. On December 31st, 2019, the company decided to sell the backhoe for $350,000. What is the amount of the gain or loss realized on the sale of this asset? (number only, no commas or negative signs)

QUESTION 3

For the answer to #2, was it a gain or loss that was realized on the sale of the asset?

a. Gain

b. Loss

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