Indicate Whether Each of the Following Transactions Would Result in a Gain,a

question 188

Short Answer

Indicate whether each of the following transactions would result in a gain,a loss,or neither a gain nor a loss.
A= Gain
B= Loss
C= Neither a gain nor a loss
______ 1.Sold an asset for $4,000.The asset had an original cost of $10,000 and accumulated depreciation of $8,000 had been recorded up to the date of the sale.
______ 2.Sold stock for $12,000.The stock was purchased four years ago for $16,000.
______ 3.Bought a machine 9 years ago for $100,000 and over the years recorded accumulated depreciation of $75,000.Sold the machine for $25,000.
______ 4.Seven years ago the company purchased a patent with a 10-year useful life for $30,000.Sold rights to the patent for $11,000.
______ 5.Recorded $80,000 of depreciation on an asset that originally cost $100,000 and then sold it for a $10,000 note receivable.
______ 6.Bought a machine 5 years ago for $50,000 and over the years recorded accumulated depreciation of $45,000.Sold the machine for $7,000.

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Definitions:

Accounts Payable

The sum of funds that a company is required to pay to its suppliers for goods and services obtained on credit.

Retained Earnings Account

An equity account that represents the cumulative earnings of a company that have not been distributed to shareholders as dividends.

Statement of Stockholders' Equity

A financial statement that shows changes in the value of a company's equity over a specific period, including stocks and retained earnings.

Income Statement

A document detailing a company's income, outgoings, and financial performance for a set timeframe.