A fixed asset with a cost of $15,000 and accumulated depreciation of $12,500 is sold for $1,750

Accounting Dec 20, 2020

A fixed asset with a cost of $15,000 and accumulated depreciation of $12,500 is sold for $1,750. What is the amount of gain or loss on disposal of the fixed asset? a. $2,500 loss b. $750 gain c. $750 loss d. $2,500 gain

Expert Solution

Book value as on date of sale=Cost-Accumulated depreciation

=(15000-12500)=$2500

Hence since sale proceeds is less than book value as on date of sale;

Loss in disposal=(2500-1750)=$750.

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