Entries for Sale of Fixed Asset

Equipment acquired on January 8, 2011, at a cost of $420,000, has an estimated useful life of 15 years, has an estimated residual value of $30,000, and is depreciated by the straight line method.

a. What was the book value of the equipment at December 31, 2014, the end of the year? $ ___________

b. Assume that the equipment was sold on October 1, 2015, for $275,000.

1. Journalize the entry to record depreciation for the nine months until the sale date.

Depreciation Expense- Equipment $ ____________

Accumulated Depreciation $ _______

2. Journalize the entry to record the sale of the equipment.

Cash $ _______

Accumulated Depreciation - Equipment $ ____

Loss on Sale of Equipment $ ______

Equipment $ ______