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38. On January 1, a machine with a useful life of five years and a residual value of $3,00 is purchased for $15,000. What is the depreciation expense in year 2 using the declining-balance method? A) S3,600 B) $4,800 C) $4,080 D) $6,000 39. A truck that cost $12,000 and on which $9,000 of accumulated depreci ation has been recorded was disposed of on January 1. If the truck was discarded as having no value, the entry to record this event would include a A) credit to Accumulated Depreciation for $12,000. B) credit to Accumulated Depreciation for $9,000. C) gain of $3,000. D) loss of $3,000. truck that cost $12,000 and on which $9,000 of accumulated depreciation has beern recorded was disposed of on January 1. Assume that the truck was disposed of for $2,000 cash. The entry to record this event would include a 40. A A) credit to the Truck account for $3,000. B) gain of $1,000. C) loss of $1,000. D) credit to Accumulated Depreciation for $9,000. 41. A truck that cost $12,000 and on which $9,000 of accumulated depreciation has been recorded was disposed of on January 1. Assume that the truck was traded for a similar truck having a price of $13,000, that an $1,800 trade-in was allowed, and that the balance was paid in cash. Under Federal income tax accounting rules, there would be no gain or loss on the transaction. However for financial accounting purposes, the amount of the gain or loss recognized on this transaction would be A) a $1,200 loss. B) a $1,200 gain. C) no gain recognized. D) no loss recognized

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