On 1 October 2004 a company purchased machinery for $26 000. It was decided to depreciate the asset using the reducing balance method at a rate of 20 % per annum.
On 30 September 2006 the asset was sold for $12 000.
What is the profit or loss on disposal?
1 )
$3600 loss
2 )
$3600 profit
$4640 loss
4 )
$4640 profit
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