Disposal of Fixed Asset

Perfect Auto Rentals sold one of its cars on January 1, 2019. Perfect had acquired the car on January 1, 2017, for $13,500. At acquisition Perfect assumed that the car would have an estimated life of 3 years and a residual value of $3,000. Assume that Perfect has recorded straight-line depreciation expense for 2017 and 2018.

Required:

Prepare the journal entry to record the sale of the car assuming the car sold for (a) $6,500 cash, (b) $4,000 cash, and (c) $7,200 cash. The company recorded the car as equipment. If no entry is required, leave the answer boxes blank.

a.	Accumulated DepreciationCashDepreciation Expense-EquipmentEquipmentGain on Disposal of Property, Plant, and EquipmentLoss on Disposal of Property, Plant, and EquipmentCash	Cash	Cash
	Accumulated DepreciationDepreciation Expense-EquipmentEquipmentGain on Disposal of Property, Plant, and EquipmentLoss on Disposal of Property, Plant, and EquipmentAccumulated Depreciation	Accumulated Depreciation	Accumulated Depreciation
	Accumulated DepreciationCashDepreciation Expense-EquipmentEquipmentGain on Disposal of Property, Plant, and EquipmentLoss on Disposal of Property, Plant, and EquipmentEquipment	Equipment	Equipment
	Record sale of car
b.	Accounts PayableCashDepreciation Expense-EquipmentEquipmentGain on Disposal of Property, Plant, and EquipmentCash	Cash	Cash
	Accounts PayableAccumulated DepreciationDepreciation Expense-EquipmentEquipmentSuppliesAccumulated Depreciation	Accumulated Depreciation	Accumulated Depreciation
	Accounts PayableDepreciation ExpenseEquipmentGain on Disposal of Property, Plant, and EquipmentLoss on Disposal of Property, Plant, and EquipmentLoss on Disposal of Property, Plant, and Equipment	Loss on Disposal of Property, Plant, and Equipment	Loss on Disposal of Property, Plant, and Equipment
	Accumulated DepreciationDepreciation Expense-EquipmentEquipmentGain on Disposal of Property, Plant, and EquipmentLoss on Disposal of Property, Plant, and EquipmentEquipment	Equipment	Equipment
	Record sale of car
c.	CashDepreciation Expense-EquipmentEquipmentGain on Disposal of Property, Plant, and EquipmentLoss on Disposal of Property, Plant, and EquipmentCash	Cash	Cash
	Accumulated DepreciationDepreciation Expense-EquipmentEquipmentGain on Disposal of Property, Plant, and EquipmentLoss on Disposal of Property, Plant, and EquipmentAccumulated Depreciation	Accumulated Depreciation	Accumulated Depreciation
	Accumulated DepreciationCashDepreciation Expense-EquipmentGain on Disposal of Property, Plant, and EquipmentLoss on Disposal of Property, Plant, and EquipmentGain on Disposal of Property, Plant, and Equipment	Gain on Disposal of Property, Plant, and Equipment	Gain on Disposal of Property, Plant, and Equipment
	Accumulated DepreciationCashEquipmentGain on Disposal of Property, Plant, and EquipmentLoss on Disposal of Property, Plant, and EquipmentEquipment	Equipment	Equipment
	Record sale of car