During the current year, Rayon Corporation disposed of two different assets. On January 1, prior to their disposal, the accounts reflected the following: Original Cost $63,000 14,500 6 years 5 years The machines were disposed of in the following ways: Asset Machine A Machine B No a. Machine A: Sold on January 2, for $39,000 cash. b. Machine B: On January 2, this machine was scrapped with zero proceeds (and zero cost of removal). 1 Required: 1.&2. Prepare the journal entries related to the disposal of Machine A and Machine B on January 2 of the current year. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) 2 3 4 Date January 02 January 02 Residual Value $11,300 2,150 January 02 January 02 Estimated Life No Journal Entry Required Answer is not complete. General Journal Accumulated Depreciation (straight-line) $25,850 (3 years) 7,410 (3 years) Cash Accumulated Depreciation-Equipment Equipment Gain on Disposal of PPE No Journal Entry Required Accumulated Depreciation-Equipment Loss on Disposal of PPE Debit 39,000 25,850 7,410 Credit

During the current year, Rayon Corporation disposed of two different assets. On January 1, prior to their disposal, the accounts reflected the following: Original Cost $63,000 14,500 6 years 5 years The machines were disposed of in the following ways: Asset Machine A Machine B No a. Machine A: Sold on January 2, for $39,000 cash. b. Machine B: On January 2, this machine was scrapped with zero proceeds (and zero cost of removal). 1 Required: 1.&2. Prepare the journal entries related to the disposal of Machine A and Machine B on January 2 of the current year. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) 2 3 4 Date January 02 January 02 Residual Value $11,300 2,150 January 02 January 02 Estimated Life No Journal Entry Required Answer is not complete. General Journal Accumulated Depreciation (straight-line) $25,850 (3 years) 7,410 (3 years) Cash Accumulated Depreciation-Equipment Equipment Gain on Disposal of PPE No Journal Entry Required Accumulated Depreciation-Equipment Loss on Disposal of PPE Debit 39,000 25,850 7,410 Credit

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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