Vax Ltd acquired a vehicle on 1 July 2019 for $32,000. The estimated useful life of the vehicle at acquisition date was 4 years and the residual value was $2,000. Vax Ltd uses straight line depreciation on vehicles. The company sold the vehicle on 1 January 2022 for $12,000.

The journal entry(ies) needed to reflect the sale will be:

Select one:

a.

DR Cash 12,000 DR Accumulated depreciation 22,500 CR Gain on sale 2,500 CR Vehicle 32,000

b.

DR Cash 12,000 CR Proceeds on sale 12,000; DR Carrying amount of vehicle 13,250 CR Vehicle 13,250

c.

DR Cash 12,000 DR Accumulated depreciation 18,750 DR Loss on sale 1,250 CR Vehicle 32,000

d.

DR Cash 12,000 CR Proceeds on sale 12,000; Dr Accumulated depreciation 26,250 DR Carrying amount of vehicle 5,750 CR Vehicle 32,000