Computing Depreciation, Net Book Value, and Gain or Loss on Asset Sale

Lynch Company owns and operates a delivery van that originally cost $46,400. Lynch has recorded straight-line depreciation on the van for four years, calculated assuming a $5,000 expected salvage value at the end of its estimated six-year useful life. Depreciation was last recorded at the end of the fourth year, at which time Lynch disposes of this van.

a. Compute the net book value of the van on the disposal date.

$Answer

0.00 points out of 1.00

b. Compute the gain or loss on sale of the van if the disposal proceeds are:Use a negative sign with your answer if the sale results in a loss.

1. A cash amount equal to the van's net book value. $Answer

1.00 points out of 1.00

2. $21,000 cash. $Answer

0.00 points out of 1.00

3. $17,000 cash. $Answer

0.00 points out of 1.00