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3 June, 02:52

A company discarded a computer system originally purchased for $18,000. The accumulated depreciation was $17,200. The company should recognize a (an) : Multiple Choice $800 loss. $0 gain or loss. $8,000 loss. $7,200 loss. $800 gain.

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  1. 3 June, 03:21
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    The correct answer is $800 loss.

    Explanation:

    According to the scenario, the given data are as follows:

    Purchased Amount = $18,000

    Accumulated depreciation = $17,200

    So, we can calculate the book value by using following formula:

    Book value = Purchased Amount - Accumulated depreciation

    By putting the value in the formula, we get

    $18,000 - $17,200 = $800

    So, if company discarded the computer system, Then

    Book value of computer system = Loss to the company

    Hence, Company Loss = $800
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