A Company Sells a Long-Lived Asset Which Originally Cost

question 237

Multiple Choice

A company sells a long-lived asset which originally cost $ 150,000 for $ 50,000 on December 31, 2021. The accumulated depreciation account had a balance of $ 60,000 after the current year's depreciation of $ 15,000 had been recorded. The company should recognize a

• A) $ 100,000 loss on disposal.
• B) $ 40,000 gain on disposal.
• C) $ 40,000 loss on disposal.
• D) $ 25,000 loss on disposal.

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Definitions:

Compounded Monthly

A method of calculating interest where the accumulated interest is added to the principal sum each month.

Retires

The act of leaving one's job and ceasing to work, typically because of age or health.

Retirement Savings Plan

a financial arrangement designed to allow individuals to accumulate funds for their retirement.

Compounded Monthly

This refers to the process of calculating interest on both the principal amount and accrued interest every month.