Accounting-Equipment costing $330,000, on which $225,000 of up-to date accumulated

| January 30, 2017

Question
Equipment costing $330,000, on which $225,000 of up-to date accumulated depreciation has been recorded, was disposed of on 2009 January2.

Requirement: (10 points)

What journal entries are required to record the equipment’s disposal under each of the following unrelated assumptions?

a. The equipment was sold for $120,000 cash.

b. The equipment was sold for $87,000 cash.

c. The equipment was retired from service and hauled to the junkyard. No

material was salvaged.

d. The equipment was exchanged for similar equipment having a cash price of

$450,000. A trade-in allowance of $150,000 from the cash price was

received, and the balance was paid in cash. The exchange has no commercial

substance.

e. The equipment was exchanged for similar equipment having a cash price of

$450,000. A trade-in allowance of $75,000 was received, and the balance

was paid in cash. The exchange has commercial substance.

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