Question 1 - On December 31, Strike Company sold one of its batting cages for $25,290. The equipment had an original cost of $252,900 and has accumulated depreciation of $227,610. Depreciation has been recorded up to the end of the year. What is the amount of the gain or loss on this transaction?
a. Gain of $25,290
b. Gain of $455,220
c. no gain or loss
d. cannot be determined.
Question 2 - A machine with a cost of $52,900 has an estimated residual value of $3,970 and an estimated life of 5 years or 15,216 hours. What is the amount of depreciation for the second full year, using the double-declining-balance method?
a. $10,580
b. $21,160
c. $19,572
d. $12,696