Question

A fixed asset with a cost of $30,000 and accumulated depreciation of $28,500 is sold for...

A fixed asset with a cost of $30,000 and accumulated depreciation of $28,500 is sold for $1,000. What is the amount of the gain or loss on disposal of the fixed asset?

a. $2,000 loss

b. $1,000 loss

c. $500 loss

d. $1,000 gain

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Homework Answers

Answer #1

Answer :-

The Correct Answer is Option C - $500

Explanation :-

Cost of Fixed Assets = $30,000

Accumulated Depreciation = $28,500

Book value of Fixed Assets = $30,000 - $28,500

Book value of Fixed Assets = $1,500

Sale Price of Fixed Assets = $1,000

Since Sale Price of Fixed Asset is less than Book value of Fixed Assets , so there is loss on disposal of the Fixed Assets .

Loss on disposal of the fixed asset = Book value of Fixed Assets - Sale price of Fixed Assets

Loss on disposal of the fixed asset = $1,500 - $1,000

Loss on disposal of the fixed assets = $500

So, The correct answer is Option C - $500 loss.

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