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An asset's book value is $18,900 on December 31, Year 5. The asset has been depreciated at an annual rate of $3,900 on the straight-line

An asset's book value is $18,900 on December 31, Year 5. The asset has been depreciated at an annual rate of $3,900 on the straight-line method. Assuming the asset is sold on December 31, Year 5 for $15,900, the company should record:

Multiple Choice

  • A loss on sale of $2,850.

  • A loss on sale of $3,000.

  • A gain on sale of $3,000.

  • Neither a gain nor a loss is recognized on this type of transaction.

  • A gain on sale of $2,850.

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