A company bought a computer for $1,500. Three years later, the computer was sold for$300. Assuming a 5-year estimated service life and straight-line depreciation, which account(s) would be used to record the disposal of the asset? Select all that apply.

Step 1: Define the Problem

Identify the accounts involved in recording the disposal of an asset using straight-line depreciation.

Step 2: Break Down the Problem

1. Calculate the annual depreciation expense.
2. Determine the accumulated depreciation at the time of disposal.
3. Identify the accounts affected by the disposal.

Step 3: Apply Relevant Concepts

• Straight-Line Depreciation Formula: $\text{Annual Depreciation} = \frac{\text{Cost of Asset} - \text{Salvage Value}}{\text{Useful Life}}$
• Accumulated Depreciation: Total depreciation over the period the asset was held.

Step 4: Analysis, Verify and Summarize

1. Calculate Annual Depreciation:

   • Cost of Asset = $1,500
   • Salvage Value = $300
   • Useful Life = 5 years $\text{Annual Depreciation} = \frac{1500 - 300}{5} = 240$

2. Determine Accumulated Depreciation:

   • Accumulated Depreciation after 3 years = $240 \times 3 =$720

3. Identify Accounts:

   • Cash/Bank: Record the cash received from the sale.
   • Accumulated Depreciation: Remove the accumulated depreciation from the books.
   • Computer (Asset Account): Remove the asset's original cost from the books.
   • Loss on Disposal of Asset: Record any loss if the book value is greater than the sale price.

Final Answer

The accounts used to record the disposal of the asset are:

• Cash/Bank
• Accumulated Depreciation
• Computer (Asset Account)
• Loss on Disposal of Asset