On July 1, 2012, Low Enterprises Sold Equipment with an Original

Multiple Choice

On July 1, 2012, Low Enterprises sold equipment with an original cost of $255,000 for $120,000. The equipment was purchased January 1, 2011, and was depreciated using the straight-line method assuming a five year useful life and $15,000 salvage value. The necessary entries for 2012 include a:

A) debit to Accumulated Depreciation-Equipment for $48,000.
B) credit to Gain on Sale of Equipment for $63,000.
C) credit to Cash for $120,000.
D) debit to Depreciation Expense for $24,000.