Langley Corporation sold equipment that it purchased for $300,000 four years ago. Langley purchased the equipment by paying $100,000 down and signing a note payable for $200,000. As of the date of the sale, Langley Corporation had claimed $187,500 in accumulated depreciation and it had made $50,000 in principal payments on the note payable. Langley received $80,000 cash and a note receivable for $100,000 from the purchaser in addition to the purchaser assuming Langley Corporation's $150,000 note payable. What is Langley Corporation's realized gain or loss on the sale of the equipment? a) $330,000. b) $187,500. c) $67,500. d) $217,500. e) $112,500.
Langley Corporation sold equipment that it purchased for $300,000 four years ago. Langley purchased the equipment by paying $100,000 down and signing a note payable for $200,000. As of the date of the sale, Langley Corporation had claimed $187,500 in accumulated depreciation and it had made $50,000 in principal payments on the note payable. Langley received $80,000 cash and a note receivable for $100,000 from the purchaser in addition to the purchaser assuming Langley Corporation's $150,000 note payable. What is Langley Corporation's realized gain or loss on the sale of the equipment? a) $330,000. b) $187,500. c) $67,500. d) $217,500. e) $112,500.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Langley Corporation sold equipment that it purchased
for $300,000 four years ago. Langley purchased the equipment by
paying $100,000 down and signing a note payable for $200,000. As of
the date of the sale, Langley Corporation had claimed $187,500 in
accumulated depreciation and it had made $50,000 in principal
payments on the note payable. Langley received $80,000 cash and a
note receivable for $100,000 from the purchaser in addition to the
purchaser assuming Langley Corporation's $150,000 note payable.
What is Langley Corporation's realized gain or loss on the sale of the
equipment?
a) $330,000.
b) $187,500.
c) $67,500.
d) $217,500.
e) $112,500.
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