2007-07-09 13:41:09 · 2 answers · asked by Anonymous in Science & Mathematics ➔ Astronomy & Space
You need to close off all accounts relating to the fixed asset being disposed to a gain or loss on disposal of fixed asset a/c. Assume cost of a truck was $40k. Its estimated useful life was 4 yrs so each yr's depn was $10k. After 3 yrs you decided to upgrade to a bigger truck. Before adjustment, your cost a/c had a DR bal of $40k, and your accumulated depreciation a/c had a CR bal of $30k, your nbv was $10k. You sold it for $12k. Your journal entries are:
Dr Cash 12k (proceeds from sale)
Dr Accd depn 30k (to close off the a/c)
Cr Motor vehicle at cost 40k (to close off the a/c)
Cr Gain on disposal of motor vehicle 2k (to recognise gain)
2007-07-09 23:11:51 · answer #1 · answered by Sandy 7 · 0⤊ 0⤋
You probably want to ask this in the Accounting category, not Astronomy&Space.
2007-07-09 20:45:19 · answer #2 · answered by Anonymous · 0⤊ 0⤋