CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 8-3 Disposing of Plant Assets...
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CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 8-3 LESSON 8-3 Disposing of Plant Assets Disposing of plant assets. Gain/loss on plant assets. Trading plant assets. Selling land and buildings
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Transcript of CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 8-3 Disposing of Plant Assets...
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 8-3LESSON 8-3
Disposing of Plant Assets
Disposing of plant assets.Gain/loss on plant assets.Trading plant assets.Selling land and buildings
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
Competency: Accounting Adjustments Competency: Accounting Adjustments and Valuation/Accounting for Plant Assetsand Valuation/Accounting for Plant Assets
Objectives
46. Compare the methods of calculated depreciation.
47. Record depreciation of plant assets.
48. Record sale, trade-in, and disposal of plant assets.
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LESSON 8-3
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
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LESSON 8-3
1. Record entry to remove plant asset from accounts.
2. Write the date, amount, and type of disposal.
DISCARDING A PLANT ASSET DISCARDING A PLANT ASSET WITH NO BOOK VALUEWITH NO BOOK VALUE page 235
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January 5, 20X6. Discarded storage cabinet: original cost, $275.00; total accumulated depreciation through December 31, 20X5, $275.00. Memorandum No. 72.
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CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
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LESSON 8-3
June 30, 20X6. Discarded office table: original cost, $200.00; total accumulated depreciation through December 31, 20X5, $140.00; additional depreciation to be recorded through June 30, 20X6, $20.00. Memorandum No. 92.
1. Record a partial year’s depreciation expense.
2. Record the partial year’s depreciation.
4. Record entry to remove plant asset from accounts.
3. Write the date, amount, and type of disposal.
DISCARDING A PLANT ASSET DISCARDING A PLANT ASSET WITH A BOOK VALUEWITH A BOOK VALUE page 236
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CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
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LESSON 8-3
3. Record entry to remove plant asset from accounts.
1. Compute the gain or loss on the sale.
2. Write the date, amount, and type of disposal.
SELLING A PLANT ASSETSELLING A PLANT ASSET page 267
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January 4, 20X6. Received cash from sale of fax machine, $185.00: original cost, $600.00; total accumulated depreciation through December 31, 20X5, $400.00. Receipt No. 60.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
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LESSON 8-3
1. Compute the original cost of the new plant asset.
TRADING A PLANT ASSETTRADING A PLANT ASSET page 238
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June 27, 20X6. Paid cash, $850.00, plus old counter for new store counter: original cost of old counter, $1,000.00; total accumulated depreciation through June 27, 20X6, $765.00. Memorandum No. 130 and Check No. 154.
4. Record entry to remove old plant asset and add new plant asset.
2. Write the date and type of disposal and the disposal amount.
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3. Complete section 1 for the new plant asset.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
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LESSON 8-3
3. Record entry to remove plant assets from accounts.
1. Compute the gain on sale of plant assets.
2. Write the date, type, and amount of disposal.
SELLING LAND AND BUILDINGSSELLING LAND AND BUILDINGS page 239
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January 2, 20X6. Fidelity Company sold land with a building for $97,000.00 cash; original cost of land, $25,000.00; original cost of building, $150,000.00; total accumulated depreciation on building through December 31, 20X5, $85,000.00. Receipt No. 105.
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CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
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LESSON 8-3
CALCULATING THE GAIN ON SALE OF CALCULATING THE GAIN ON SALE OF LAND AND BUILDINGSLAND AND BUILDINGS page 240
