Accounting MCQ
Accounting
On January 1, 2021, Jacob Inc. purchased a commercial truck for $48,000 and uses the straight-line depreciation method. The truck has a useful life of eight years and an estimated residual value of $8,000. Assume the truck was totaled in an accident on December 31, 2022. What amount of gain or loss should Jacob Inc. record on December 31, 2022?
On January 1, 2021, Jacob Inc. purchased a commercial truck for $48,000 and uses the straight-line depreciation method. The truck has a useful life of eight years and an estimated residual value of $8,000. Assume the truck was totaled in an accident on December 31, 2022. What amount of gain or loss should Jacob Inc. record on December 31, 2022?
On January 1, 2021, Jacob Inc. purchased a commercial truck for $48,000 and uses the straight-line depreciation method. The truck has a useful life of eight years and an estimated residual value of $8,000.
Assume the truck was totaled in an accident on December 31, 2022. What amount of gain or loss should Jacob Inc. record on December 31, 2022?
A) Gain, $5,000.
B) Loss, $18,000.
C) Loss, $38,000.
D) Loss, $3,000.
Answer: C
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