On January 1, 2012, Coronado Industries purchased for $762000, equipment having a useful life of ten years and an estimated salvage value of $45000. Coronado has recorded monthly depreciation of the equipment on the straight-line method. On December 31, 2020, the equipment was sold for $162500. As a result of this sale, Coronado should recognize a gain of

$45,800

Explanation:

Given that: the cost of the equipment =  $762000

We can determine the accumulated depreciation as follows:

Accumulated depreciation= ((cost of equipment - salvage value )/useful lifetime )×Depreciation from 2012 to 2020

$ 645,300

The Book value of equipment as on December 31,2020 = cost of equipment - accumulated depreciation

= $762,000 - $645,300

= $ 116,700

Also; the sale value = $162500

The gain to be recognize = $162,500 - $ 116,700 = $45,800

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explanation:

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