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What would the gain or loss on disposal be

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Question - Ariel's Treasures Limited purchased a printing press on January 1, 2020 for $28,900. The printing press is expected to have a 4 year or 4,000,000 pages useful life and an $3,900 residual value. Ariel's has a December 31, 2020 year-end.

Required -

1. Compute the depreciation for 2020, 2021, 2022 & 2023 using:

(a) the straight line method

(b) the units of production method assuming Ariel's printed 1,200,000 pages in 2020, 850,000 pages in 2021, 1,150,000 pages in 2022 & 1,000,000 in 2023.

2. What is the carrying value of the printing press at December 31, 2023 under both methods?

3. If Ariel's Treasures Limited sells the printing press on January 1, 2024 for $4,500 what would the gain or loss on disposal be?

Reference no: EM133017467

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