Tara Purchased a Machine for $40,000 to Be Used in Her

question 23

Multiple Choice

Tara purchased a machine for $40,000 to be used in her business.The cost recovery allowed and allowable for the three years the machine was used are computed as follows.
Cost Recovery Allowed
Cost Recovery Allowable
Year 1
$16,000
$ 8,000
Year 2
9,600
12,800
Year 3
5,760
7,680
If Tara sells the machine after three years for $15,000,how much gain should she recognize?

• A)$3,480
• B)$6,360
• C)$9,240
• D)$11,480
• E)None of the above

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Definitions:

Granting Claims

The process of approving requests or demands, often in legal, insurance, or benefits contexts.

Requests For Adjustment

Appeals or petitions for a change or modification in a service, product, or agreement, often due to dissatisfaction or a change in needs.

Customer Fault

A situation where an issue or problem with a product or service is due to the actions or inactions of the customer.

Logical Sequence

The orderly and consistent progression of ideas or events, typically ensuring that each point or step follows naturally from the previous one.