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Computer equipment (office equipment) purchased 6 1/2 years ago for $170,000, with an estimated life of 8 years and a residual value of $10,000, is

Computer equipment (office equipment) purchased 6 1/2 years ago for $170,000, with an estimated life of 8 years and a residual value of $10,000, is now sold for $60,000 cash. (Appropriate entries for depreciation had been made for the first six years of use.)

Required:

Journalize the following entries on December 31:
(a) Record the depreciation for the one-half year prior to the sale, using the straight-line method.*
(b) Record the sale of the equipment.*
(c) Assuming that the equipment had been sold for $25,000 cash, prepare the entry to record the sale.*
*Refer to the Chart of Accounts for exact wording of account titles.

CHART OF ACCOUNTSGeneral Ledger

ASSETS
110 Cash
111 Petty Cash
112 Accounts Receivable
114 Interest Receivable
115 Notes Receivable
116 Merchandise Inventory
117 Supplies
119 Prepaid Insurance
120 Land
121 Office Equipment
122 Accumulated Depreciation-Office Equipment
132 Goodwill
133 Patents
LIABILITIES
210 Accounts Payable
211 Salaries Payable
213 Sales Tax Payable
214 Interest Payable
215 Notes Payable
EQUITY
310 Common Stock
311 Retained Earnings
312 Dividends
313 Income Summary
REVENUE
410 Sales
610 Interest Revenue
620 Gain on Sale of Equipment
EXPENSES
510 Cost of Merchandise Sold
520 Salaries Expense
521 Advertising Expense
522 Supplies Expense
523 Delivery Expense
524 Rent Expense
525 Insurance Expense
531 Repairs and Maintenance Expense
541 Depreciation Expense-Office Equipment
543 Depletion Expense
544 Amortization Expense-Patents
591 Miscellaneous Expense
710 Interest Expense
720 Loss on Sale of Equipment

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