1. Lawler Clothing sold manufacturing equipment for $25,000. Lawler originally purchased the equipment for $89,000 and depreciation to date of sale totaled $75,500. What was the gain or loss on the sale of the equipment?

2. On July 15, 2018, Cottonwood Industries sold a patent and equipment to Roque more Corporation for $950,000 and $425,000, respectively. The book value of the patent and equipment at the date of sale were $220,000 and $520,000 ($770,000 cost less $250,000 accumulated depreciation), respectively. Prepare journal entries to record sales of the patent and equipment .

3. Bodega Mondale depreciates its equipment using the group method. The cost of the equipment acquired in 2016 amounted to $515,000. The estimated residual value of the equipment was $49,000 and the depreciation rate of the group was determined to be 18%. What is the annual depreciation for the group? If a piece of equipment that cost $51,000 is sold in 2017 for $44,000, what amount of gain or loss will the company recognize on the sale?

Answer rating: 100% (QA)

1 To calculate the gain or loss on the sale of the equipment we need to subtract the equipments book value from the sale proceeds The book value is th... View the full answer