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Principles of Accounting Volume 1

19th Edition
OpenStax
Publisher: OpenStax College
ISBN: 9781947172685
FindFindarrow_forward

Principles of Accounting Volume 1

19th Edition
OpenStax
Publisher: OpenStax College
ISBN: 9781947172685
Chapter 11, Problem 14PB
Textbook Problem
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Garcia Co. owns equipment that costs $150,000, with accumulated depreciation of $65,000. Garcia sells the equipment for cash. Record the journal entry for the sale of the equipment if Garcia were to sell the equipment for the following amounts:

A. $90,000 cash

B. $85,000 cash

C. $80,000 cash

To determine

(a)

Introduction:

Property, Plant and Equipment is a head in the balance sheet’s asset side, that shows all the tangible assets of the organization. It is represented at the historic cost as reduced by accumulated depreciation.

To prepare:

Journal entry to record sale of equipment.

Explanation of Solution

Record sale of equipment:

Date Account Debit ($) Credit ($)
Cash 90,000
Accumulated Depreciation-Equipment 65,000
Equipment 150,000
Gain on Sale-Equipment 5,000
(To record sale of equipment...
To determine

(b)

Introduction:

Journal entries record business transactions. These transactions have double effect on accounts such that total of all assets equate with liabilities and equities.

To prepare:

Journal entry to record sale of equipment.

To determine

(c)

To prepare:

Journal entry to record sale of equipment.

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Chapter 11 Solutions

Principles of Accounting Volume 1
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