Ask Question
11 April, 16:40

Sandhill Co. sells office equipment on July 31, 2022, for $22,430 cash. The office equipment originally cost $77,870 and as of January 1, 2022, had accumulated depreciation of $36,830. Depreciation for the first 7 months of 2022 is $4,580. Prepare the journal entries to (a) update depreciation to July 31, 2022, and (b) record the sale of the equipment

+4
Answers (1)
  1. 11 April, 16:59
    0
    (a)

    July 31, 2022

    Dr. Depreciation Expense $4,580

    Cr. Accumulated Depreciation $4,580

    (b)

    Dr. Cash $22,430

    Dr. Accumulated Depreciation $41,410

    Dr. Loss on Sale of asset $14,030

    Cr. Cost $77,870

    Explanation:

    Before sale of the asset, depreciation for the year should be recorded. To incorporate its effect on the sale. The depreciation for the 7 months of 2022 will be added to the accumulated depreciation account.

    July 31, 2022

    Accumulated Depreciation = $36,830 + $4,580 = $41,410

    Net Loss is calculated by deducting the accumulated depreciation and cash received on the sale from the original cost of the asset.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Sandhill Co. sells office equipment on July 31, 2022, for $22,430 cash. The office equipment originally cost $77,870 and as of January 1, ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers