Question

Kelly Petroleum Products owns fully depreciated furniture that was purchased for $26,500. The furniture had an estimated useful life of 8 years and an estimated residual value of $2,500. The furniture was sold for $2,700. Gain from the sale of asset is $ ......... (fill the blank please )

If an asset is fully depreciated, but it can continue to be used, the asset account and accumulated depreciation balance remain on the books, and no further depreciation is recorded (true or false)

The maturity date for a​ six-month note issued on January 15 would be​ ..... (fill the blank)

Answer 1

1. Kelly Petroleum Products owns a fully depreciated furniture. Being the fully depreciated furniture, the net book value of such furniture is Zero. As the Asset was sold for $ 2,700, the Gain from the sale of the asset is $ 2700.

2. If an asset is fully depreciated, the net book value of the asset is Zero.(Though the asset is continued to be used). As per the Standards, the net book value of the asset can not be negative. It means that no further depreciation is charged after the asset is fully depreciated.. So the statement is TRUE.

3. The maturity date for a six-month note issued on January 15 would be July 15 (Just add 6 months to January.)