Warren Paints Purchased Machinery for $75,000 Eight Years Ago

Multiple Choice

Warren Paints purchased machinery for $75,000 eight years ago. It was expected to have a useful life of ten years, no salvage value, and was depreciated using the straight-line method. At the end of its eighth year of use it was retired from service and given to a junk dealer. The entry to record the retirement includes a:

A) debit to Loss on Disposal for $15,000.
B) debit to Machinery for $75,000.
C) debit to Depreciation Expense for $15,000.
D) credit to Accumulated Depreciation-Machinery for $60,000.