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Gunkelson Company sells equipment on September 30, 2020, for $18,000 cash. The equipment originally cost $72,000 and as of January 1, 2020, had accumulated depreciation of $42,000. Depreciation for the first 9 months of 2020 is $5,250. Prepare the journal entries to (a) update depreciation to September 30, 2020, and (b) record the sale of the equipment.

Respuesta :

Answer:

Explanation:

Initial cost - 72000

Accumulated depreciation as at January 1, 2020 = 42000

Carrying value at January 1, 2020 (72,000-42000)- 30000

Sales proceed = $5250

Depreciation fr the first 9 months = $5250

                                             

January 1      Debit  Machine  - 30000

                       Debit Accumulated depreciation - 42,000

September 30

                      Credit machine 5250

                       Debit accumulated depreciation          5250

sales of equipment

                    Credit machine (3000-5250)          24750    

                     Debit cash                                                               18000

                     Debit loss on disposal of asset                               6750                          

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