Equipment was acquired at the beginning of the year at a cost of $75,000. The equipment was depreciated using the straight-line method based upon an estimated useful life of 6 years and an estimated residual value of $7,500.
a)What was the depreciation expense for the first ye ar?
b)Assuming the equipment was sold at the end of the second ye ar for $ \$ 59,000 $, detemine the gain or loss on sale of the equipment.
c)Joumalize the entry to record the sale.

Question

Equipment was acquired at the beginning of the year at a cost of $75,000. The equipment was depreciated using the straight-line method based upon an estimated useful life of 6 years and an estimated residual value of $7,500.
 a)What was the depreciation expense for the first ye ar?
b)Assuming the equipment was sold at the end of the second ye ar for $ \$ 59,000 $, detemine the gain or loss on sale of the equipment. 
c)Joumalize the entry to record the sale.

Quizplus · Accepted Answer

The Answer of Equipment was acquired at the beginning of the year at a cost of $75,000. The equipment was depreciated using the straight-line method based upon an estimated useful life of 6 years and an estimated residual value of $7,500.
 a)What was the depreciation expense for the first ye ar?
b)Assuming the equipment was sold at the end of the second ye ar for $ \$ 59,000 $, detemine the gain or loss on sale of the equipment. 
c)Joumalize the entry to record the sale.

Equipment Was Acquired at the Beginning of the Year at a Cost