Entries for Sale of Fixed Asset

Equipment acquired on January 8 at a cost of $140,490 has an estimated useful life of 17 years, has an estimated residual value of $7,550, and is depreciated by the straight-line method.

a. What was the book value of the equipment at December 31 the end of the fourth year? $fill in the blank cb7e6000602ffe1_1

Feedback

Book value is the initial cost of the fixed asset minus the accumulated depreciation.

b. Assume that the equipment was sold on April 1 of the fifth year for $102,240.

1. Journalize the entry to record depreciation for the three months until the sale date. If an amount box does not require an entry, leave it blank. Round your answers to the nearest whole dollar if required.

	Depreciation Expense-Equipment	fill in the blank c0a216f55028016_2	fill in the blank c0a216f55028016_3
	Accumulated Depreciation-Equipment	fill in the blank c0a216f55028016_5	fill in the blank c0a216f55028016_6

Feedback

The depreciation account of the fixed asset being sold or discarded needs to be updated to reflect the months of use in the year it is being discarded or sold. The straight-line method of depreciation calculates the amount of depreciation to be recognized each year.

2. Journalize the entry to record the sale of the equipment. If an amount box does not require an entry, leave it blank. Do not round intermediate calculations.

	Cash	fill in the blank 367f4308005005c_2	fill in the blank 367f4308005005c_3
	Accumulated Depreciation-Equipment	fill in the blank 367f4308005005c_5	fill in the blank 367f4308005005c_6
	Loss on Sale of Equipment	fill in the blank 367f4308005005c_8	fill in the blank 367f4308005005c_9
	Equipment	fill in the blank 367f4308005005c_11	fill in the blank 367f4308005005c_12