Question

If a fixed asset with an original cost of $18,000 and accumulated depreciation of $12,000 is sold for $15,000, the company must __________.

Select one:

Recognize a loss on the income statement under other expenses

Recognize a loss on the income statement under operating expenses

Recognize a gain on the income statement under other revenues

Gains and losses are not to be recognized upon the sell of fixed assets

Question

If a fixed asset is sold and the book value is less than cash received, the company must __________.

Select one:

Recognize a loss on the income statement under other expenses

Recognize a loss on the income statement under operating expenses

Recognize a gain on the income statement under other revenues

Gains and losses are not to be recognized upon the sell of fixed assets

Question

A gain is recorded on the sale of fixed assets when __________.

Select one:

The asset is sold for a price less than its book value

The assets book value is less than the cash received

A gain on sale is not permitted to be recognized

Accumulated depreciation is less than the cash received

Question

A company sold a delivery truck for $18,000 cash. The truck cost $47,500 and had accumulated depreciation of $36,000 as of the date of sale. The entry to record the sale would include __________.

Select one:

An increase in accumulated depreciation for $36,000

A decrease in delivery truck for $11,500

A loss for $6,500

A gain for $6,500

Question

The process of transferring the cost of natural resources to an expense is termed __________.

Select one:

Depreciation

Amortization

Depletion

Reserve recognition