Question

On June 1, 2021, XYZ Company paid $150,000 to purchase equipment. The
equipment was assigned a useful life of 15 years and a $6,000 residual
value. The equipment will be depreciated using the straight-line method.

On November 1, 2027, XYZ Company sold the equipment for $72,100 cash.

Calculate the amount of the loss recorded on the sale of the equipment.
Do not put a minus sign in front of your answer.

Answer 1

--Amount of LOSS = $ 16,300

A	Cost	$150,000
B	Salvage value	$6,000
C= A - B	Depreciable cost	$144,000
D	Life	15
E = C/D	Straight Line depreciation annually	$9,600
F = E/12	Monthly Depreication	$800
G = 7+12+12+12+12+12+10	No of months since 1 June 2021 to 30 Sept 2017	77
H = F x G	Accumulated Depreciation at time of sale	$61,600
I = A - H	Book Valuer at time of Sale	$88,400
J	Sold for	$72,100
K = I - J	Loss on Sale of equipment	$16,300	Answer