Question

Wildhorse Corporation owns machinery that cost $21,600 when purchased on July 1, 2014. Depreciation has been recorded at a rate of $2,592 per year, resulting in a balance in accumulated depreciation of $9,072 at December 31, 2017. The machinery is sold on September 1, 2018, for $11,340. Prepare journal entries to (a) update depreciation for 2018 and (b) record the sale. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) No. Account Titles and Explanation Debit Credit (a)

Answer 1

No	Date	Accounts Titles & Explanation	Debit ($)	Credit ($)
(a)	August 31, 2018	Depreciation [$2,592 * 8/12]	1,728
		Accumulated Depreciation - Machinery		1,728
		(To record depreciation for the year till date of sale of machnery)
(b)	September 1, 2018	Cash	11,340
		Accumulated Depreciation - Machinery [$9,072 + $1,728]	10,800
		Machinery		21,600
		Gain on disposal of machinery		540
		(To record sales of machinery & gain on sales thereon )