Marks Consulting Purchased Equipment Costing $45,000 on January 1,Year 1

question 39

Multiple Choice

Marks Consulting purchased equipment costing $45,000 on January 1,Year 1.The equipment is estimated to have a salvage value of $5,000 and an estimated useful life of 8 years.Straight-line depreciation is used.If the equipment is sold on July 1,Year 5 for $20,000,the journal entry to record the sale will include a:

• A)Credit to cash for $20,000.
• B)Debit to accumulated depreciation for $22,500.
• C)Debit to loss on sale for $10,000.
• D)Credit to loss on sale for $10,000.
• E)Debit to gain on sale for $2,500.

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