Allen Construction, Inc., had a piece of equipment that cost $32,000 and had accumulated depreciation of $24,000.

Requirement

1. Record the disposition of the equipment assuming the following independent situations:

a. Allen Construction discarded the equipment, receiving $0.

b. Allen Construction sold the equipment for $10,000 cash.

c. Allen Construction traded the equipment in on a new piece of equipment costing $41,000. Allen Construction was granted an $11,000 trade-in allowance for the old equipment and paid the difference in cash.

d. Allen Construction traded the equipment in on a new piece of equipment costing $38,000. Allen Construction was granted a $4,500 trade-in allowance for the old equipment and signed a note payable for the difference.