Paper 1 October/November 2020 Accounting (9706/11) A Level
A company purchased a machine on 1 April 2021 for $25 000. It was depreciated at 20% per annum using the straight-line method. A full year’s depreciation is charged in the year of purchase but none in the year of sale. On 30 June 2023 the machine was sold for $12 500.
The company’s year end is 31 December.
What was the profit or loss on the disposal of the machine?