James Company Has an Asset That Cost $5,000 and Currently

question 57

Multiple Choice

James Company has an asset that cost $5,000 and currently has accumulated depreciation of $2,000. Suppose the firm sold the asset for $2,500 and is subject to a 30% income tax rate. The loss on disposal would be:

• A)$350.
• B)$500.
• C)$650.
• D)$2,500.
• E)$5,000.

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Definitions:

Quantity of Gold Bars

The total number or amount of gold bars, often measured in terms of weight or units in a specific context.

Resource Extraction

This term refers to the process of obtaining resources from the Earth, such as minerals, oil, and gas, through methods like mining, drilling, and fracking.

Conservation

The practice of protecting the natural environment and preserving resources by managing and using them responsibly to prevent depletion.

Present Value

Today’s value of some amount of money that is to be received sometime in the future.