Which accounts are affected, and in which direction, when a company disposes of a piece of equipment for cash, where the amount of cash received is greater than the book value of the equipment?

a)

Cash and sales revenue both increase, and equipment and depreciation expense both decrease.

b)

Equipment and accumulated depreciation both decrease, cash increases, and the difference decreases depreciation expense.

c)

Equipment and accumulated depreciation both decrease, cash increases, and the difference increases gain on disposal.

d)

Equipment and accumulated depreciation both decrease, cash increases, and the difference increases sales revenue.

e)

Equipment and accumulated depreciation both decrease, cash increases, and the difference increases retained earnings.