On January 2, 2014, Royal Pet purchased fixtures for $39,200 cash, expecting the fixtures to remain in service for six years, Royal Pet has depreciated the fixtures on a straight-line basis, with $5,000 residual value. On July 31, 2016, Royal Pet sold the fixtures for $20,975 cash. Record both depreciation expense for 2016 and sale of the fixtures on July 31, 2016. (Assume the modified half-month convention is used. Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Begin by recording the depreciation expense for 2016. Date Jul. 31 Accounts and Explanation Debit Credit Before recording the sale of the fixtures, let's calculate any gain or loss on the sale of the fixtures. (Enter a loss with a minus sign or parentheses.) Market value of assets received
On January 2, 2014, Royal Pet purchased fixtures for $39,200 cash, expecting the fixtures to remain in service for six years, Royal Pet has depreciated the fixtures on a straight-line basis, with $5,000 residual value. On July 31, 2016, Royal Pet sold the fixtures for $20,975 cash. Record both depreciation expense for 2016 and sale of the fixtures on July 31, 2016. (Assume the modified half-month convention is used. Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Begin by recording the depreciation expense for 2016. Date Jul. 31 Accounts and Explanation Debit Credit Before recording the sale of the fixtures, let's calculate any gain or loss on the sale of the fixtures. (Enter a loss with a minus sign or parentheses.) Market value of assets received
Chapter1: Financial Statements And Business Decisions
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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.
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Transcribed Image Text:On January 2, 2014, Royal Pet purchased fixtures for $39,200 cash, expecting the fixtures to remain in service for six years. Royal Pet has depreciated
the fixtures on a straight-line basis, with $5,000 residual value. On July 31, 2016, Royal Pet sold the fixtures for $20,975 cash. Record both depreciation
expense for 2016 and sale of the fixtures on July 31, 2016. (Assume the modified half-month convention is used. Record debits first, then credits. Select
the explanation on the last line of the journal entry table.)
Begin by recording the depreciation expense for 2016.
Date
Jul 31
Accounts and Explanation
Debit
Credit
Before recording the sale of the fixtures, let's calculate any gain or loss on the sale of the fixtures. (Enter a loss with a minus sign or parentheses.)
Market value of assets received
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