LESSON 8 3 Disposing of Plant Assets CENTURY

LESSON 8 -3 Disposing of Plant Assets CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 8 -3

2 DISCARDING A PLANT ASSET WITH NO BOOK VALUE page 235 January 5, 20 X 6. Discarded storage cabinet: original cost, $275. 00; total accumulated depreciation through December 31, 20 X 5, $275. 00. Memorandum No. 72. 1. Record entry to remove plant asset from accounts. 1 2. Write the date, amount, and type of disposal. 2 CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 8 -3

3 DISCARDING A PLANT ASSET WITH A BOOK VALUE page 236 June 30, 20 X 6. Discarded office table: original cost, $200. 00; total accumulated depreciation through December 31, 20 X 5, $140. 00; additional depreciation to be recorded through June 30, 20 X 6, $20. 00. Memorandum No. 92. 1 4 1. Record a partial year’s depreciation expense. 2. Record the partial year’s depreciation. 3 3. Write the date, amount, and type of disposal. 2 4. Record entry to remove plant asset from accounts. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 8 -3

4 SELLING A PLANT ASSET page 267 January 4, 20 X 6. Received cash from sale of fax machine, $185. 00: original cost, $600. 00; total accumulated depreciation through December 31, 20 X 5, $400. Receipt No. 60. 3 1 1. Compute the gain or loss on the sale. 2 2. Write the date, amount, and type of disposal. 3. Record entry to remove plant asset from accounts. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 8 -3

5 TRADING A PLANT ASSET page 238 June 27, 20 X 6. 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, 20 X 6, $765. 00. Memorandum No. 130 and Check No. 154. 1. Compute the original cost of the new plant asset. 4 1 2. Write the date and type of disposal and the disposal amount. 2 3 3. Complete section 1 for the new plant asset. 4. Record entry to remove old plant asset and add new plant asset. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 8 -3

6 SELLING LAND BUILDINGS page 239 January 2, 20 X 6. 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, 20 X 5, $85, 000. Receipt No. 105. 1. Compute the gain on sale of plant assets. 2. Write the date, type, and amount of disposal. 3. Record entry to remove plant assets from accounts. 2 3 CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 1 LESSON 8 -3

7 CALCULATING THE GAIN ON SALE OF LAND BUILDINGS CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning page 240 LESSON 8 -3