Corey Sales Sold Its Old Office Furniture for $400

question 157

Multiple Choice

Corey Sales sold its old office furniture for $400.The original cost was $8,000,and at the time of sale,it had accumulated depreciation of $7,000.What was the effect of the transaction?

• A) Gain of $600
• B) Gain of $400
• C) Loss of $1,600
• D) Loss of $600

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Definitions:

Liabilities

Financial obligations or debts owed by a business to external parties or creditors.

Owner's Capital

The amount of money and other assets invested into a business by its owner or owners.

Owner's Drawings

Money removed by a sole proprietorship or partnership owner from the company for their private use.

Revenue

Revenue is the income generated from normal business operations and includes discounts and deductions for returned merchandise.