The business sold this asset on December 27, 2015. The disposal amount received was $1,200. Complete the disposal section of the plant asset record and journalize the disposal transaction using the journal provided.
The business sold this asset on December 27, 2015. The disposal amount received was $1,200. Complete the disposal section of the plant asset record and journalize the disposal transaction using the journal provided.
Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter19: Accounting For Plant Assets, Depreciation, And Intangible Assets
Section: Chapter Questions
Problem 4AP
Related questions
Concept explainers
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
Topic Video
Question
Transcribed Image Text:Practice 3:
The business sold this asset on December 27, 2015. The disposal amount received was $1,200.
Complete the disposal section of the plant asset record and journalize the disposal transaction using the journal provided.
The journal page is 25 and the source document for the disposal transaction is Receipt 15.
PLANT ASSET RECORD No.
Date
Bought January 2, 2012
Date
Description Oven
YEAR
2012
2013
2014
2015
Disposed of:
Estimated
Useful Life
DATE
4 years
Annual Depreciation Expense
$750.00
$750.00
$750.00
$750.00
62
Discarded
Estimated
Salvage
Value
Serial # NN24587P
ACCOUNT TITLE
$1,000.00
Sold
Accumulated Depreciation
$750.00
$1,500.00
$2,250.00
$3,000.00
General Ledger Account No. 1160
POST
DOC NO. REF.
G/L Account Store Equipment
CASH RECEIPTS JOURNAL
Disposal Amount
Original Cost
GENERAL
Depreciation
DEBIT CREDIT
$4,000.00
Method Straight-Line
Traded
Ending Book Value
$3,250.00
$2,500.00
$1,750.00
$1,000.00
ACCTS.
REC.
SALES
CREDIT CREDIT
SALES TAX
PAYABLE
DEBIT DEBIT
PAGE
SALES
DISC.
DEBIT
CASH
DEBIT
1
2
3
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Century 21 Accounting Multicolumn Journal
Accounting
ISBN:
9781337679503
Author:
Gilbertson
Publisher:
Cengage
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning
Century 21 Accounting Multicolumn Journal
Accounting
ISBN:
9781337679503
Author:
Gilbertson
Publisher:
Cengage
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning