Chapter 9, Problem 9.8BE

a.

To determine

Plant Assets: Plant assets refer to the fixed assets having a useful life of more than a year which is, acquired by a company to be used in its business activities, for generating revenue.

Disposal of Assets: Disposal is an activity of selling the worn-out assets that is no longer in need for the business, in return of some consideration. Disposal may be made in any of the following situations:

• Disposal with no gain no loss: When the asset is disposed with no consideration received.
• Disposal with gain: When the asset is disposed for more than its book value (original cost less accumulated depreciation).
• Disposal with loss: When the asset is disposed for less than its book value.

To record: the journal entry for depreciation expense for the first 7 months of 2017

b.

To determine

To record: the journal entry for the sale of equipment