A company discarded a computer system originally purchased for $8,750. The accumulated depreciation was $6,450. The company should recognize a (an): Multiple Choice $0 gain or los. $2,300 loss. $2,300 gain. $8,750 gain. $6,450 loss.

A company discarded a computer system originally purchased for $8,750. The accumulated depreciation was $6,450. The company should recognize a (an): Multiple Choice $0 gain or los. $2,300 loss. $2,300 gain. $8,750 gain. $6,450 loss.

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter7: Fixed Assets, Natural Resources, And Intangible Assets

Section: Chapter Questions

Problem 7.3.3C: Effect of depreciation on net income Einstein Construction Co. specializes in building replicas of...

See similar textbooks

Related questions

Q: Hauswirth Corporation sold (or exchanged) a warehouse in year 0. Hauswirth bought the warehouse…

A: Answer to question a. Purchase cost of warehouse $65,000 Less: Depreciation claimed till year 0…

Q: On December 31, Strike Company sold one of its batting cages for $198,177. The equipment had an…

A: Net book value = Cost - accumulated depreciation = $233,150 - $34,973 = $198,177

Q: Bramble Manufacturing has old equipment that cost $56,000. The equipment has accumulated…

A: Depreciation means decline in the estimation of benefit inside its valuable life because of mileage…

Q: Morrell Corporation sold a computer at the end of its useful life for $300. The computer had an…

Q: A company discarded a computer system originally purchased for $8,750. The accumulated depreciation…

A: Gain or loss on disposal or writeoff of fixed assets will be part of Income Statement of the…

Q: A company had a bulldozer destroyed by fire. The bulldozer originally cost $125,000. The accumulated…

A: For determining profit or loss to be computed we should consider the insurance proceeds.

Q: A fixed asset with a cost of $27,355 and accumulated depreciation of $24,619.50 is sold for…

A: Given that, Cost of the fixed asset = $27335 Accumulated depreciation = $24619.50 Sale value of…

Q: Dlaz Company owns a machine that cost $126,300 and has accumulated depreciation of $94,400. Prepare…

A: Gain (loss) on sale of Machinery = Sales value - Net book value of the Machinery where, Net book…

Q: SINA Company furnace, which has a current book value of $45000 (Original Cost less accumulated…

A: Gain loss on Disposition of assets = Amount received from insurance company - current book value of…

Q: M Company acquired a new machinery. The following data are available: List price of the machinery…

A: Total cost of an asset includes all such cost or expenditure which is required for the operation of…

Q: On December 31, Strike Company sold one of its batting cages for $20,000. The equipment had an…

A: The depreciation expense is charged on fixed assets as reduced value of the fixed asset with usage…

Q: Stark Industries., a C corporation, owned an office building for several years. The building was…

A: Depreciation :— The monetary value of an asset decreases over time due to use, wear and tear or…

Q: Piper’s Pizza sold baking equipment for $25,000. The equipment was originally purchased for $72,000,…

A: Given information is: Sale Revenue of Equipment = $25,000 Original cost of Equipment = $72,000…

Q: On December 31, Strike Company sold one of its batting cages for $250,452. The equipment had an…

A: Depreciation expense: Depreciation expense is the reduction in a particular asset due to its use or…

Q: Alexander Company purchased a piece of equipment for $14,000 and depreciated it for three years over…

A: Disclaimer: “Since you have asked multiple question, we will solve the first question for you. If…

Q: Gaston owns equipment that cost $27,500 with accumulated depreciation of $22,000. Gaston sells the…

A: Journal Entry: Journal entry is the act of keeping records of transactions in an accounting journal.…

Q: At year – end Jade Company has an equipment with the following cost and accumulated depreciation;…

A: Solution:- Calculation of impairment as follows under:- As per the U.S GAAP has a two steps to…

Q: On December 31, Strike Company sold one of its batting cages for $206,720. The equipment had an…

A: Book Value = $243,200 - $36,480 Book Value = $206,720

Q: Granite Stone Creamery sold ice cream equipment for $16,000. Granite Stone originally purchased the…

A: Fixed assets like equipment are capitalized in the books when they are initially acquired instead of…

Q: deductible loss from permanent retirement?

A: Deductible loss = Cost - Accumulated depreciation - Salvage value

Q: 2. Compute Depreciation and gain or loss if cost of the building is $100,000; no salvage value;…

A: The depreciation is provided as a reduction or decrease in the value of fixed assets. The…

Q: I didn't realized there were Tables for MACRS for the question that was rejected. Hopefully, the…

A: Calculate Cost recovery amount on Convers's assets in the current year. Notes: The general…

Q: Dog Co. acquired and placed in service the following assets during the year: Date Cost Asset…

A: The section 179 deduction of the IRS tax code allows businesses to deduct the total purchase price…

Q: Mario Ltd purchased a machine for GHS 50,000 on 1 January 20X1. The machine was judged to have a…

A: Formula: Loss on disposal = Book value of Asset - sale value of Asset. Deduction of sale value of…

Q: After recording depreciation for the current year, Media Mania Incorporated decided to discontinue…

A: Loss on impairment = carrying value - Recoverable amount Where, Recoverable amount = Lower of fair…

Q: A company discarded a computer system originally purchased for $8,850. The accumulated depreciation…

A: Depreciation means the amount fixed assets written off due to normal wear and tear , normal usage ,…

Q: A company discarded a computer system originally purchased for $8,750. The accumulated depreciation…

A: The expenses charged to income statement as estimated cost of using fixed asset is called…

Q: James Company sells a plant asset that originally cost $180,000 for $60,000 on December 31, 20x1.…

A: Calculation of book value of plant at the time of disposal : Book Value = Cost of asset -…

Q: Wetherby purchased a machine on 1 July 20X7 for $500,000. It is being depreciated on a straight line…

A: We have the following information: Wetherby purchased a machine on 1 July 20X7 for $500,000 It is…

Q: Elite Co. has office furniture that cost $75,000 and that has been depreciated $48,000. Record the…

A: Journal entry is the process of recording the business transactions in the accounting books for the…

Q: n December 31, Strike Company sold one of its batting cages for $194,607. The equipment had an…

A: Depreciation is reduction in the value of asset over a period of time.

Q: On 1/1/X2, Hudson Enterprises decided to sell equipment it had been using in its business for…

A: The depreciation is charged on asset so at to reduce the book value of fixed asset with passage of…

Q: Ngu own equipment that cost 96,500 with accumulated depreciation of 66,000. Ngu asks 35,750 for the…

A: Whenever any fixed asset is sold out, then carrying value of the asset is compared with actual sale…

Q: Mazaya Company has decided to sell one of its old machines on June 30, 2011. The machinewas…

A: Annual Depreciation = (Cost of the assets - Salvage value) / life of the assets = (120000 - 0) / 10…

Q: Synthia, Inc., a clothing manufacturer, purchased a sewing machine for P10,000 on July 1, 20x1. The…

A: Impairment loss is incorrect because it is calculated when the fair value of any asset (or…

Q: Mazaya Company has decided to sell one of its old machines on June 30, 2011. The machine was…

A: As per straight line method, the depreciation is computed by dividing the original cost less salvage…

Q: A company sold a machine that originally cost $250,000 for $120,000 when accumulated depreciation on…

A: Option a, asset increase by $50,000, liabilities increase by $50,000, no effect on equity, is…

Q: Amanda Company purchased a computer that cost $11,200. It had an estimated useful life of five years…

A: Answer:- Depreciation meaning:- A reduction in the worth of an asset is generally referred to as…

Concept explainers

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.

Question

A company discarded a computer system originally purchased for $8,750. The accumulated depreciation was $6,450. The company should recognize a (an):
Multiple Choice
$0 gain or loss.
$2,300 lo
$2,300 gain.
$8,750 gain.
$6,450 loss.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

INTRODUCTION

VIEW

ANSWER

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

A copy machine cost $39,000 when new and has accumulated depreciation of $25,000. Suppose Print Center sold the machine for $14,000. What is the result of this disposal transaction? OA. Gain of $14,000 OB. Loss of $25,000 OC. Loss of $14,000 D. No gain or loss
A company discarded a computer system originally purchased for $8,750. The accumulated depreciation was $6,450. The company should recognize a (an):
A company sold a machine that originally cost $250,000 for $120,000 when accumulated depreciation on the machine was $100,000. The gain or loss recorded on the sale of this machine is a. $0 gain or loss. d. $30,000 gain. b. $120,000 gain. e. $150,000 loss. c. $30,000 loss.
JT Enterprises decides to scrap its old widget-making machine, which has a book value of $8,600. The salvage company pays JT $8,700 for the machine. How should JT record this disposition? a.) as a $100 loss b.) as a $100 gain c.) as an $8,600 loss d.) as an $8,700 gain
James Company sells a plant asset that originally cost $180,000 for $60,000 on December 31, 20x1. The accumulated depreciation account had a balance of $72,000. What should the company recognize? a. $ 120,000 loss on disposal. b. $ 48,000 loss on disposal. c. $ 48,000 gain on disposal. d. $ 30,000 loss on disposal.
Effect of depreciation on net income Einstein Construction Co. specializes in building replicas of historic houses. Bree Andrus. president of Einstein Construction, is considering the purchase of various items of equipment on July 1. 20Y2. for $300,000. The equipment would have a useful life of five years and no residual value. In the past, all equipment has been leased. For tax purposes, Bee is considenng depreciating the equipment by the straight-line method. She discussed the matter with her CPA and learned that although the straight-line method could be elected, it was to her advantage to use the Modified Accelerated Cost Recovery System (MACRS) for tax purposes. She asked for your advice as to which method to use for tax purposes. What factors would you present for Bree’s consideration in the selection of a depreciation method?
Becker Office Service purchased a new computer system on January 1, 2018, for $30,800. It is expected to have a five-year useful life and a $3,600 salvage value. Becker Office Service expects to use the computer system more extensively in the early years of its life. Required a. Calculate the depreciation expense for each of the five years, assuming the use of straight-line depreciation. Salvage Value Useful Annual Year Cost Life Depreciation 1 2 3 4 b. Calculate the depreciation expense for each of the five years, assuming the use of double-declining-balance depreciation. (Enter all amounts as positive values. Do not round intermediate calculations. Round "SL rate" answers to 2 decimal places. Round your answers to the nearest dollar amount.) Accumulated Depreciation Annual Beginning of Period (2 x SL Rate) Year Cost Depreciation 1 2 3 4
Bravo Company's furnace, which has a current book value of $40,000 (original cost less than accumulated depreciation), has been destroyed. If the insurance company pays Bravo $45,000, which of the following transactions is Bravo supposed to record? Select the single best answer: A debit Cash $45,000 credit Equipment/Furnace $45,000 B. debit Cash $40,000, debit Equipment/Furnace $40,000 C credit Gain on Disposition of Equipment/Furnace $45,000, debit Cash $45,000 D. debit Equipment/Furnace $5,000 credit Equipment/Furnace $40.000, debit Cash $45,000 E credit Gain on Disposition of Equipment/Furnace $5,000 credit Equipment/Furnace $40,000; debit Cash $45.000
6-SINA Company furnace, which has a current book value of $45000 (Original Cost less accumulated depreciation), has been destroyed. If the insurance company pays Bravo$50000 which of the following transactions should be recorded? A-Debit Cash $50000; Credit Equipment/ Furnace $50000. B- Debit Cash $45000; debit Equipment/ Furnace $45000. C-Credit Gain on Disposition of Equipment/ Furnace $50000; Debit cash $50000. D-debit Equipment/ Furnace $5000; Credit Equipment/ Furnace $45000; debit Cash $50000. E-Credit Gain on Disposition of Equipment/ Furnace $5000; Credit Equipment/ Furnace $45000; Debit Cash $50000.
ion(1) to course 'Taxation(1)' 14 The Britannia Company newly installed the software. The WDV at OMR 100,000, unfortunately software corrupted. The technician backup the corrupted software, service expenditure OMR 1000. Calculate the depreciation value, put of Select one: a. OMR 32,670 b. OMR 33,330 Oc. OMR 28.450 Od OMR 33,000 Next page nage
1. Disposal of an asset. From pages 7-7 and 7-8 of the VLN, the company sold the mower after using it for a year and a half for $6,000. In recording the sale, they would: Group of answer choices A. Debit a loss for $2,000 B. Debit cash for $2,000 C. Credit a gain for $1,000 D. Credit accumulated depreciation for $3,000 2. From page 7-8 of the VLN, what is the net profit margin in the practice problem on the bottom of the page? Do not include the % sign, carry to one decimal place. ___._%
Norse Company acquired a new machine on January 15 20X1. It sold the machine October 15 20X2 incurring a $10,000 loss. What is the nature of the loss? (a.) Capital Loss (b.) Ordinary Loss (c.) Inventory Loss (e.) Section 1231 Loss