An asset that costs $14,400 and has accumulated depreciation of $8,000 is sold for $5,600. What amount of gain or loss will be recognized when the asset is sold?

A) A gain of $2,400.

B) A loss of $2,400.

C) A loss of $800.

D) A gain of $800.

Question

Business

Giana Elliott

10 September, 22:11

An asset that costs $14,400 and has accumulated depreciation of $8,000 is sold for $5,600. What amount of gain or loss will be recognized when the asset is sold?

A) A gain of $2,400.

B) A loss of $2,400.

C) A loss of $800.

D) A gain of $800.

+2

Answers (1)

Know the Answer?

Cordell King · Answer 1

C. Loss of $800

Explanation:

Given that

Purchase price = 14400

Depreciation = 8000

Selling price = 5600

Thus,

Value of asset after depreciation = Purchase price - Depreciation

= 14400 - 8000

= 6400.

Therefore,

Difference between current value and price sold = value of asset after depreciation - selling price

= 6400 - 5600

= 800

Therefore, there was a loss of $800, since the selling price is less than the value of asset after depreciation.

An asset that costs $14,400 and has accumulated depreciation of $8,000 is sold for $5,600. What amount of gain or loss will be recognized when the asset is sold?A) A gain of $2,400.B) A loss of $2,400.C) A loss of $800.D) A gain of $800.

An asset that costs $14,400 and has accumulated depreciation of $8,000 is sold for $5,600. What amount of gain or loss will be recognized when the asset is sold?

A) A gain of $2,400.

B) A loss of $2,400.

C) A loss of $800.

D) A gain of $800.