ICAEW AF · Chapter 11 · Question 5 of 13
A company sells equipment that cost £28,000 and has accumulated depreciation of £17,500 for proceeds of £9,200. What is the profit or loss on disposal?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Loss of £1,300
Explanation
Carrying amount = £28,000 - £17,500 = £10,500. Proceeds of £9,200 are less than the carrying amount, so there is a loss on disposal of £10,500 - £9,200 = £1,300, charged to profit or loss.
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