A company sells a piece of equipment halfway through the accounting period. The straight-line rate of depreciation on the equipment is $40,000 per year. Before preparing the entry to record the sale of the equipment, the company should first debit: A. Depreciation Expense for $40,000 and credit Accumulated Depreciation for $40,000. B. Accumulated Depreciation for $40,000 and credit Cash for $40,000. C. Depreciation Expense for $20,000 and credit Accumulated Depreciation for $20,000. D. Cash for $20,000 and credit Depreciation Expense for $20,000.

A company sells a piece of equipment halfway through the accounting period. The straight-line rate of depreciation on the equipment is $40,000 per year. Before preparing the entry to record the sale of the equipment, the company should first debit: A. Depreciation Expense for $40,000 and credit Accumulated Depreciation for $40,000. B. Accumulated Depreciation for $40,000 and credit Cash for $40,000. C. Depreciation Expense for $20,000 and credit Accumulated Depreciation for $20,000. D. Cash for $20,000 and credit Depreciation Expense for $20,000.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter11: Depreciation, Depletion, Impairment, And Disposal

Section: Chapter Questions

Problem 7E: Loban Company purchased four cars for 9,000 each and expects that they will be sold in 3 years for...

See similar textbooks

Similar questions

Loban Company purchased four cars for 9,000 each and expects that they will be sold in 3 years for 1,500 each. The company uses group depreciation on a straight-line basis. Required: 1. Prepare journal entries to record the acquisition and the first years depreciation expense. 2. If one of the cars is sold at the beginning of the second year for 7,000, what journal entry is required?
You are an accountant for ABC Corp. Your purchasing department has procured products invoiced for $25,000 with 2/10 Net 30 terms. If you pay the invoice within 15 days, your payment would be: $25,500. $20,000. $24,500. $25,000. Accounting depreciation systematically allocates the cost of an asset in time over its useful life while economic depreciation deals with: The estimated loss of value of an asset minus the revenue it produces. The estimated salvage value of an asset at its end-of-life. The change of an asset’s value based on fair market price. The value of an asset matched to the revenue it creates indirectly.
An asset's book value is $25,200 on January 1, Year 6. The asset is being depreciated $350 per month using the straight-line method. Assuming the asset is sold on July 1, Year 7 for $17,900, the company should record:
On December 29, 2021, Patel Products, Incorporated, sells a delivery van that cost $20,000. The equipment had accumulated depreciation of $16,000 at December 31, 2020. Annual depreciation on this equipment is $2,000 computed using straight-line depreciation. Complete the necessary journal entry to bring the accumulated depreciation up-to-date by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns. On December 29, 2021, Patel Products, Inc., sells a delivery van that cost $20,000. The equipment had accumulated depreciation of $16,000 at December 31, 2020. Annual depreciation on this equipment is $2,000 computed using straight-line depreciation.
On December 29, 2021, Patel Products, Incorporated, sells a delivery van that cost $20,000. The equipment had accumulated depreciation of $16,000 at December 31, 2020. Annual depreciation on this equipment is $2,000 computed using straight-line depreciation. Complete the necessary journal entry to bring the accumulated depreciation up-to-date by selecting the account names from the drop- down menus and entering the dollar amounts in the debit or credit columns. View transaction list Journal entry worksheet 1 On December 29, 2021, Patel Products, Inc., sells a delivery van that cost $20,000. The equipment had accumulated depreciation of $16,000 at December 31, 2020. Annual depreciation on this equipment is $2,000 computed using straight-line depreciation. Note: Enter debits before credits. Date Dec. 29 General Journal Debit Credit
Blossom Company sells office equipment on July 31, 2022, for $20,100 cash. The office equipment originally cost $72,800 and as of January 1, 2022, had accumulated depreciation of $42,100. Depreciation for the first 7 months of 2022 is $5,450. Prepare the journal entries to (a) update depreciation to July 31, 2022, and (b) record the sale of the equipment. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) No. Account Titles and Explanation Debit Credit (a) (b)
At the beginning of the current year, Andy Company has equipment that originally cost $70,000, has $49,000 accumulated depreciation, and is being depreciated at $7,000 per year. Andy sells this equipment for $15,500 at the end of the current year. Required: Prepare journal entries to record both the current year’s depreciation and the disposal of the equipment.
Blossom Company sells office equipment on July 31, 2022, for $23,050 cash. The office equipment originally cost $85,450 and as of January 1, 2022, had accumulated depreciation of $39,450. Depreciation for the first 7 months of 2022 is $4,410. Prepare the journal entries to (a) update depreciation to July 31, 2022, and (b) record the sale of the equipment. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)
Crane Company sells office equipment on July 31, 2022, for $20,440 cash. The office equipment originally cost $82,640 and as of January 1, 2022, had accumulated depreciation of $38,770. Depreciation for the first 7 months of 2022 is $4,250.Prepare the journal entries to (a) update depreciation to July 31, 2022, and (b) record the sale of the equipment. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) No. Account Titles and Explanation Debit Credit (a) Enter an account title to update depreciation to July 31 Enter a debit amount Enter a credit amount enter an account title to update depreciation to July 31 Enter a debit amount Enter a credit amount (b) Enter an account title to record the sale of the equipment Enter a debit amount Enter a credit amount Enter an account title to record the sale of…
Can you please give me correct answer for this accounting question?
A business purchased a motor car on 1 July 20X3 for $20,000. It is to be depreciated at 20 per cent per year on the straight line basis, assuming a residual value at the end of five years of $4,000, with a proportionate depreciation charge in the years of purchase and disposal. The $20,000 cost was correctly entered in the cash book but posted to the debit of the motor vehicles repairs account. How will the business profit for the year ended 31 December 20X3 be affected by the error?
Astro Company sold equipment on July 1, 2021 for $75,000. The equipment had cost $210,000 and had $120,000 of accumulated depreciation as of January 1, 2021. The equipment is being annually depreciated at an amount of $24,000. Required: Prepare the necessary journal entries to: A. Update the depreciation for the equipment. B. Record the sale of the equipment.