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What is the treatment of accumulated depreciation and depreciation in the event of asset disposal?
Wiki User
∙ 11y ago
When the asset is disposed of the Accumulated Depreciation is subtracted from the cost of the asset.
Journal Entries:
If Sold at a Profit:
Dr Accumulated Depreciation (All Depreciation)
Dr Bank/ Recievable (Amount received for Asset)
Cr Asset (Carrying Value on Balance Sheet)
Cr Profit on Asset Disposal (Balancing Figure)
If Sold at a Loss:
Dr Accumulated Depreciation (All Depreciation)
Dr Bank/ Recievable (Amount received for Asset)
Dr Loss on Asset Disposal (Balancing Figure)
Cr Asset (Carrying Value on Balance Sheet)
Please note there may also be current year depreciation
Wiki User
∙ 11y ago
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How do you calculate disposal of fixed assets?
[Debit] Accumulated depreciation [Debit] Loss on disposal (if any) [Credit] Asset [Credit] Profit on disposal (if any)
What is the journal entries for disposal of fixed asset?
cr asset account for cost price dr accumulated depreciation for asset depreciation cr asset sale account dr/cr profit/loss on asset account
What is the journal entry to write of an asset that is not completely depreciated?
[Debit] Accumulated Depreciation [Debit] Cash (If any) [Debit] Loss on disposal (if any) Credit Asset Credit Profit of disposal of asset (if any)
What is accumulated depreciation?
The accumulated deprecation is the all the depreciation amounts should be the accumulated depreciation.
The difference between the cost of an asset and the accumulated depreciation for that asset is called?
Book Value is the difference between the cost of an asset and the accumulated depreciation of that asset.
Does accumulated depreciation increase with a credit?
accumulated depreciation is an asset, so it will increase with a debit.
What is the journal entry to write off a fully depreciated asset?
[Debit] Cash (if any) xxxx [Debit] Accumulated depreciation xxxx [Debit] Loss on disposal of asset (if any) xxxx [Credit] Asset account xxxx [Credit] Profit on disposal of asset(if any)xxxx
What is accumulated depreciation on a statement of cash flow?
Accumulated depreciation is the amount of a long-term's asset's cost that has been allocated to depreciation since the time the asset was acquired.
What is the journal entry to record fixed asset disposals?
[Debit] Accululated Depreciation xxxx [Debit] Loss on disposal of asset xxxx [Credit] Asset account xxxx Entry 2 [debit] Profit and loss account xxxx [Credit] Loss on disposal of asset xxxx
Is Accumulated depreciation debit or credit?
Accumulated depreciation is a contra to related asset so if asset has a debit balance then it has credit balance to reduce the related asset's value.
How is the net book value of a depreciable asset calculated?
The net book value of a depreciable asset is calculated by deducting the accumulated depreciation from the original cost of the asset. Accumulated depreciation is the total depreciation expense recorded over the life of the asset. This calculation allows for the determination of the asset's value at a specific point in time.
What is the purpose of depreciation expense and accumulated depreciation?
Depreciation expense reduce the cost of asset through income statement for the useful life of asset and accumulated depreciation account is contra account for asset account in balance sheet to show the total amount of depreciation charged.
