Ryan, Inc., uses straight-line depreciation for all of its depreciable assets. Ryan sold a used piece of machinery on December 31, 2012, that it purchased on January 1, 2011, for $10,000. The asset had a five-year life, zero residual value, and $2,000 accumulated depreciation as of December 31, 2011. If the sales price of the used machine was $6,500, the resulting gain or loss upon the sale was which of the following amounts?
a. Loss of $500
b. Gain of $500
c. Loss of $1,500
d. Gain of $1,500
e. No gain or loss upon the sale.
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