A trucking company sold its fleet of trucks for $56,800. The trucks originally cost $1,496,000 and had Accumulated Depreciation of $1,287,000 recorded through the date of disposal. What gain or loss did the trucking company record when it sold the fleet of trucks?

the trucking company recorded a loss on disposal of $152,200 when it sold the fleet of trucks.

Explanation:

Open the Truck Disposal T-Account as Follows:

Debits:

Cost $1,496,000

Totals $1,496,000

Credits:

Cash Receipt $56,800

Accumulated Depreciation $1,287,000

Profit and Loss (Balancing figure) $152,200

Totals $1,496,000

Therefore, there was a loss on disposal of $152,200

loss on disposal = $152,200

Explanation:

The gains on disposal is the the difference between the net sales proceeds on disposal and the carrying value of the assets as the date of disposal.

The carrying value = Cost of the assets - accumulated depreciation to date

Carrying value = $1,496,000 - $1,287,00

=209,000

Loss on disposal = $56,800 - $ 209,000 = - 152,200