An Asset's Carrying Amount Is $18,000 on June 30, Year

Multiple Choice

An asset's carrying amount is $18,000 on June 30, Year 6. The asset is being depreciated at an annual rate of $3,000 on the straight-line method. Assuming the asset is sold on December 31, Year 7 for $15,000, the company should record:

A) A loss on sale of $1,500.
B) A gain on sale of $1,500.
C) Neither a gain nor a loss is recognized on this type of transaction.
D) A gain on sale of $3,000.
E) A loss on sale of $3,000.