Question

Reflex Corp purchased equipment on June 30, 2011 for $50,000. It had an estimated useful life...

Reflex Corp purchased equipment on June 30, 2011 for $50,000. It had an estimated useful life of 10 years and

an estimated salvage value of $12,000. On January 1, 2019, it was sold for $24,000. Reflex uses the straight

line method of depreciating its assets. The journal entry to record the disposal of this asset would include:

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Answer #1
Depreciation per year (Original Cost - Salvage Value)/Estimated useful life 3800
2011 Half-year depreciation 1900
2012 Full year depreciation 3800
2013 Full year depreciation 3800
2014 Full year depreciation 3800
2015 Full year depreciation 3800
2016 Full year depreciation 3800
2017 Full year depreciation 3800
2018 Full year depreciation 3800
Total Accumulated depreciation 28500

Based on the above and other information provided in the quesiton, the journal entry will be

Date General Journal Debit Credit
1-Jan Cash 24000
Accumulated Depreciation - Equipment 28500
Gain on Disposal 2500
Equipment 50000
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