Homework SourseDuring the current year Rayon Corporation disposed of two di
During the current year, Rayon Corporation disposed of two different assets. On January 1, prior to their disposal, the accounts reflected the following:
| During the current year, Rayon Corporation disposed of two different assets. On January 1, prior to their disposal, the accounts reflected the following: |
Solution
Journal entry :
| Transaction | account and explanation | debit | credit |
| 1 | No entry | ||
| 2 | Cash | 33900 | |
| Accumlated depreciation-Machine A | 32750 | ||
| Gain on disposal of machine | 2650 | ||
| Machine A | 64000 | ||
| (To record disposal of machine A) | |||
| 3 | No entry | ||
| 4 | Accumlated depreciation-Machine B | 8400 | |
| Loss on disposal of machine B | 6200 | ||
| Machine B | 14600 | ||
| (To record disposal of machine B) | |||
