When a company sells a plant asset which originally cost $360,000 for $120,000 on december 31, 2018 the company should recognize a 96,000 loss on disposal.
From the following information:
The cost of plant assets = $360,000
Selling value of the plant assets = $120,000
Accumulated Depreciation = $144,000
Therefore,
the net book value of the plant assets = Total cost of the plant - the depreciation.
or
the net book value of the plant assets = $ 360,000 - $ 144,000 = $216,000
Since, the net book value is more than the selling price.
Therefore, the loss on disposal = Book value - selling cost
= $216,000 - $ 120,000
or
the loss = $ 96,000
Therefore the company should recognize a $96,000 loss on disposal.
Know more about assets:
https://brainly.com/question/22053614
#SPJ4
