On 1 January 2011, Y Ltd purchased a new machine for $500 000. The estimated scrap value of the machine is $20 000. The machine is depreciated...

On 1 January 2011, Y Ltd purchased a new machine for $500 000. The estimated scrap value of the machine is $20 000. The machine is depreciated straight -line over its useful life of 6 years.  On 31 December 2012, Y Ltd sold the machine for $400 000 to a director of the company. The gain or loss on sale is:

Select one:

a. Gain on sale $60 000

b. Loss on sale $100 000

c. Loss on sale $80 000

d. There is no gain or loss