On april 30, 2014 Titan purchased machinery for $88,000. The useful life of this machinery is estimated at 8 years, with an $8,000 residual value.

Based on this, in the year 2020, Titan sells the machinery for $4,500. At the date of sale, the machinery had been depreciated by Titan to its estimated residual value of $8k. This sale results in....

a. $3,5000 loss on both the company’s financial statements and income tax return

b. no gain or loss in either the financial statements or income tax return

c. a $3,500 loss in the financial statements and a $3,500 gain in the income tax return

d. A 3,500 loss in the financial statements but no loss or gain on the tax return