8. If a long-lived asset was sold before the end of its estimated useful life, the gain or loss on disposal is found by subtracting

a. the book value from the cash received.

b. accumulated depreciation from the original cost of the asset.

c. the original cost of the asset from the assets book value.

d. the assets book value from the original cost of the asset.

9. A truck costing $40,000 was purchased on January 1, 2006. The straight-line depreciation method was used, with the truck having an estimated useful life of 4 years and a salvage value of $4,000. If the truck is sold at the end of 2007 for $25,000, how much gain or loss will be recognized?

a. $3,000 loss c. $3,000 gain

b. $5,000 gain d. $5,000 loss 10. What is the entry for question 9 above:

a. Dr Cash 25,000, Dr Loss 3,000, Dr. Accumulated Depreciation 18,000 and Credit Truck 40,000

b. Dr Cash 25,000, Dr Loss 5,000, Dr. Accumulated Depreciation 20,000 and Credit Truck 40,000

c. Dr Cash 25,000, Cr Gain 3,000, Dr. Accumulated Depreciation 18,000 and Credit Truck 40,000

d. Dr Cash 25,000, Cr Gain 5,000, Dr. Accumulated Depreciation 20,000 and Credit Truck 40,000

11. All of the following are true statements concerning intangible assets, except

a. intangible assets are either purchased or created.

b. there is no accumulated depreciation account.

c. intangible assets are amortized on a straight-line basis

d. a business has physical control over intangible assets.