An asset's book value is $19,000 on December 31, Year 5. The asset has been depreciated at an annual rate of $4,000 on the straight-line method. Assuming the asset is sold on December 31, Year 5 for $16,000, the company should record:
A loss on sale of $3,000.
Neither a gain nor a loss is recognized on this type of transaction.
A gain on sale of $3,000.
A gain on sale of $3,000.
A loss on sale of $3,000.