Wang Co has delivery equipment that cost 48190 and has been

Wang Co. has delivery equipment that cost $48,190 and has been depreciated $24,200. Record entries for the disposal under the following assumptions.

(a) It was scrapped as having no value.

(b) It was sold for $37,580.

(c) It was sold for $19,780.

Solution

cost of equipment = $48,190

Since it has been depreciated = $24,200

Net Book Value = Cost - Depreciation = $23,990

A)

Credit Equipment = $48,190

Debit Accumulated Depreciation Equip.= $24,200  

Debit Loss on disposal of Equipment = $23,990


B)

Credit Equipment = $48,190

Debit Accumulated Depreciation Equip.= $24,200   

Debit Cash = $37,580

Credit Gain on disposal of Equipment = Selling Cost - Net Book Value = $13,590

C)

Credit Equipment = $48,190

Debit Accumulated Depreciation Equip.= $24,200   

Debit Cash = $19,780

Debit Loss on disposal of Equipment = Net Book Value - Selling Cost = $4,210