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A flood damaged a machine used in Ralphs business. The machine had been purchased 2 years earlier at a cost of $14,000, and Ralph had
A flood damaged a machine used in Ralphs business. The machine had been purchased 2 years earlier at a cost of $14,000, and Ralph had claimed $4,000 in depreciation. The FMV of the machine was $18,000 before the flood and $3,000 after the flood. The machine was insured, and Ralph was reimbursed $12,000. What is Ralphs gain or loss from the casualty?
- A.$2,000 loss.
- B.$3,000 loss.
- C.$2,000 gain.
- D.$15,000 loss.
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