Question

Equipment that cost $411000 and on which $194000 of accumulated depreciation has been recorded was disposed of for $173000 cash. The entry to record this event would include a ________.

Answer 1

Answer:

Given that,

Cost of equipment = $411,000

Accumulated depreciation = $194,000

Dispose accumulated depreciation for cash = $173,000

The Journal entry is as follows:

Cash A/c                                      Dr. $173,000

Accumulated depreciation A/c  Dr. $194,000

Loss in Disposal A/c                    Dr. $44,000

           To Equipment a/c                              $411,000

(To record the accumulated depreciation and dispose off.)

Loss in Disposal:

= Cost of equipment - Accumulated depreciation - Dispose accumulated depreciation

= $411,000 - $173,000  - $194,000

= $44,000