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On July 1, 2015, Hale Kennels sells equipment for $220,000. The equipment originally cost $600,000, had...

On July 1, 2015, Hale Kennels sells equipment for $220,000. The equipment originally cost $600,000, had an estimated 5-year life and an expected salvage value of $100,000. The accumulated depreciation account had a balance of $350,000 on January 1, 2015, using the straight-line method.

1) Journal entry for the catch-up depreciation from Jan 1, to July 1, 2015

2) Journal entry showing the sale of the equipment on July 1, 2015

Please write it out the answer step by step with an explanation. Thank you so much for helping me

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Answer #1

1) Journal entry for the catch-up depreciation from Jan 1, to July 1, 2015

Date account and explanation debit credit
July 1 Depreciation expense (600000-100000/5)*6/12 50000
Accumlated depreciaiton-equipment 50000
(To record dep)

2) Journal entry showing the sale of the equipment on July 1, 2015

Date account and explanation debit credit
July 1 Cash 220000
Accumlated depreciation-equipment 400000
Gain on sale of equipment 20000
Equipment 600000
(To record sale of equipment)
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