How to find gain/loss on sale and acquisition of plant and equipment?

Question

Net income for the year was $200,000.
Depreciation expense on plant and equipment was $50,000.
Plant and equipment with an original cost of $150,000 were sold for $64,000 (you will need to determine the book value of the assets sold).
Amortization expense on patents was $8,000.
Both new plant and equipment and patents were purchased for cash during the year.

Plant and equipment (2007) = 750,000 (2006) 500,000
Accumulated depreciation (2007) 160,000 (2006) 200,000
Patents (2007) 92,000 (2006) 80,000
Retained Earnings (2007) 825,000 (2006) 675,000

I need to find:
1. the gain/ loss on sale of plant and equipment
2. Acquisition of plant and equipment

Thank you very much

Answer 1

P&E at cost:
Opening 500,000
Acquired ?
Sold (150,000)
Closing 750,000
From the above you can work out the acquisition is $400,000

Accumulated depreciation:
Opening 200,000
2007 depn 50,000
Disposed ( ? )
Closing 160,000
From the above you can work out the accumulated depn reversed out on disposal was $90,000.

Gain/(loss) on sale of P&E:
Cost of item sold 150,000
Accd depn of item sold (90,000)
Nbv of item sold 60,000
Sales proceeds 64,000
Gain on sale $4,000

1. the gain on sale of plant and equipment $4,000
2. Acquisition of plant and equipment $400,000