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3. A corporation sold a piece of equipment during the current tax year for $90,00. The...

3. A corporation sold a piece of equipment during the current tax year for $90,00. The accounting records show that its cost basis, B, is $190,000 and the accumulated depreciation is $140,000. Assume that the effective income tax rate as a decimal is 0.40 (40%). Based on this information, what is

a. the gain (loss) on disposal,
b. the tax liability (or credit) resulting from this sale,
c. the tax liability (or credit) if the accumulated depreciation was $90,000 instead of $140,000?

Engineering   Civil-Engineering   
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Answer #1

Sold piece of equipment should be $90,000 as after comma there are 3 digits while you have put on two(maybe a typo) and logically also equipment having basic value of $190,000 won't be sold for $9,000.

So solving for sold piece of equipment for $90,000.

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