A Company Purchased Equipment for $5,000 on January 1,2012

Multiple Choice

A company purchased equipment for $5,000 on January 1,2012.The equipment was sold for $1,000 on December 31,2015.Accumulated Depreciation in the amount of $3,000 had been recorded through that date.How would the company record this transaction?

A) Debit Cash for $1,000,debit Accumulated Depreciation-Equipment for $3,000,credit Gain on Disposal of Equipment for $1,000,and credit Equipment for $3,000.
B) Debit Loss on Disposal of Equipment for $1,000 and credit Equipment for $1,000.
C) Debit Loss on Disposal of Equipment for $3,000 and credit Accumulated Depreciation-Equipment for 3,000.
D) Debit Equipment for $5,000,credit Gain on Disposal of Equipment for $1,000,credit Accumulated Depreciation-Equipment for $3,000,and credit Cash for $1,000.
E) Debit Cash for $1,000,debit Loss on Disposal of Equipment for $1,000,debit Accumulated Depreciation-Equipment for $3,000,and credit Equipment for $5,000.