### Disposal of Computers - Journal Entry Explanation**Scenario:**- **a.** Morrell Corporation disposed of two computers at the end of their useful lives. The computers had a cost of $4,740 with accumulated depreciation of $4,740. No residual value was received.- **b.** Assume the same information as in scenario (a), except accumulated depreciation at the date of disposal was $3,480.**Task:**Prepare the necessary journal entries to record these transactions. If no entry is necessary, select "No Journal Entry Required."#### Journal Entry Worksheet - Scenario (a)**Transaction Explanation:**Record the disposal of computers costing $4,740 with accumulated depreciation equal to the cost, amounting to $4,740.**Journal Entry:**| Transaction | General Journal | Debit | Credit ||-------------|------------------------------|--------|---------|| 1 | (Accounts not specified) | 4,740 | 4,740 |**Note:** Enter debits before credits.**Interpretation:**In this scenario, the entries reflect the complete write-off of both the cost and the accumulated depreciation since they equal each other. No gain or loss arises from the disposal as the net book value is zero.*Diagrams:*This section highlights the equal debits and credits reflecting the full depreciation over the computers' lifecycle. The absence of residual value or gain/loss indicates straightforward derecognition of these assets from the books of Morrell Corporation.

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a. Morrell Corporation disposed of two computers at the end of their useful lives. The computers had cost $4,740 and their Accumulated Depreciation was $4,740. No residual value was received. b. Assume the same information as (a), except that Accumulated Depreciation, updated to the date of disposal, was $3,480. Required: Prepare journal entries to record above transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

a. Morrell Corporation disposed of two computers at the end of their useful lives. The computers had cost $4,740 and their Accumulated Depreciation was $4,740. No residual value was received. b. Assume the same information as (a), except that Accumulated Depreciation, updated to the date of disposal, was $3,480. Required: Prepare journal entries to record above transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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