Copy Of Disposal Homework Problem Solution

Equipment 22,000

Accum. Deprec. - Equipment 19A 19B 19C

Straight Line Method used Cost - Slavage # Yrs. Of Life

= Deprec. Exp./yr.

22,000 - 2,000 4 yrs.

= 5,000/yr.

Book Value at time of sale = 22,000-15000 = 7,000 A) Amount received from sale - Book Value = Gain (loss) on sale Date 12/31/C

Accounts & Explanation Cash Accum. Deprec. - Equipment Equipment Gain on Sale of Asset

B) Amount received from sale - Book Value = Gain (loss) on sale Date 12/31/C

$8,000 7,000 $1,000 Gain Debit 8,000 15,000

Credit

22,000 1,000

$5,000 7,000 $(2,000) Loss

Accounts & Explanation Cash Accum. Deprec. - Equipment Loss on Sale of Asset Equipment

Debit 5,000 15,000

Credit

22,000

5,000 5,000 5,000 15,000