Question

Assume that on 12/31 a forklift was sold for $10,000. At the time on sale, the...

Assume that on 12/31 a forklift was sold for $10,000. At the time on sale, the its accumulates depreciation was $9,000. The machine originally cost $16,000.

Provide the journal entry to record the sale:

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Answer #1
  • When a Fixed Asset is sold:

The cost of that asset is credited, while accumulated depreciation thereon till date is Debited.

Cash received is also debited.

Loss on sale or Gain on Sale are debited or credited respectively.

  • Journal Entry would be:

Date

Accounts title

Debit

Credit

31-Dec

Cash

$           10,000.00

Accumulated Depreciation

$             9,000.00

   Gain on Sale of Equipment

$            3,000.00

   Equipment - Forklift

$          16,000.00

(Forklift sold for cash)

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