Answer: $36,000 loss
Explanation:
Initial cost = $250,000
Shipping fees = $3,500
Setup fees = $2,500
Annual maintenance = $5,000
Depreciation amount = $25,000
Proposed selling price = $200,000
Total costs involved = $(250,000 + 3,500 + 2,500 + 5,000)
Total costs involved = $261,000
Depreciation amount = $25,000
Equipment's book value = $261,000 - $25,000 = $236,000
Calculating gain/loss = Book value - selling price
Gain/loss = $236,000 - $200,000
$36,000 loss