Sale of Plant Asset Raine Company has a machine that originally cost $58.000, Depreciation has been recorded for four years using the straight line method with a 15.000 estimated salvage value at the end of an expected ten-year life. After recording depreciation at the end of four years, Raine sells the machine. Prepare the journal entry to record the machine's sale for Round to the nearest dollar) a $37,000 cash b. $36,800 cash $28.000 cash Date b General Journal Description Cash Accumulated Depreciation Equipment Equipment Gain on Sale of Plant Assets To record sale of machine Cash Accumulated Depreciation Equipment Equipment To record sale of machine Cash Loss on Sale of Plant Assets Accumulated Depreciation Equipment Equipment To record sale of machine Check 4V . ✔ ✔ Debit 37,000 34.800 M 5,000 5,000 36,800 23.200 05 38.000 23.200 M 23.200 8M Credit 5,000 5,000 OU 23.200 m 36.800 0 23,200 23,200 1.600

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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.