Question

tb problem qu. 10 - 232 (algo) disposal of assets
a company sold equipment that had originally cost $77,200 for $31,100 cash. the accumulated depreciation as of the date of the sale was $41,000.
prepare a single journal entry to record the sale of the equipment.
view transaction list
journal entry worksheet
a
record the sale of the equipment.
note: enter debits before credits.
transaction general journal debit credit
1

Explanation:

Step1: Calculate book - value of equipment

The book - value of the equipment is calculated as the original cost minus the accumulated depreciation. So, Book - value = Original cost - Accumulated depreciation = $77,200−$41,000 = $36,200.

Step2: Determine gain or loss on sale

The gain or loss on the sale is calculated as the cash received minus the book - value. Cash received = $31,100, Book - value = $36,200. Loss on sale = $31,100 - $36,200=-$5,100.

Step3: Record journal entry

When recording the sale of the equipment, we debit Cash for the amount received, debit Accumulated Depreciation to remove the accumulated depreciation of the asset, debit Loss on Sale of Equipment for the loss amount, and credit Equipment for the original cost of the asset.

Transaction	General Journal	Debit	Credit
	Accumulated Depreciation - Equipment	$41,000
	Loss on Sale of Equipment	$5,100
	Equipment		$77,200

Answer:

Transaction	General Journal	Debit	Credit
	Accumulated Depreciation - Equipment	$41,000
	Loss on Sale of Equipment	$5,100
	Equipment		$77,200