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Hi question
During the year a machine was sold for 80,000, which is included in revenue. The machine had a cost of 200,000 with accumulated depreciation of 110,000 at the date of disposal.
The company’s depreciation policy is as follows:
Buildings 1% straight line
Plant and machine 30% reducing balanceFull depreciation is charged in the year of purchase and none in the year of disposal. Land costing 500,000 is not depreciated. Depreciation expense is to be included in COS.
In the trial balance Land and Building cost 5,500,000 accumulated depreciation 1,000,000 and for Plant and Machinery cost 2,500,000 and accumulated depreciation 450,000
what are the entries for this?
Hi,
I don’t like to just answer questions outright without having seen you attempt it first. If you attempt it and then ask more specific questions then I can show you where you are going wrong. It is much better to do it this way as it will help your learning.
To help you along and get things started, you need to remove the proceeds from revenue and calculate a profit on disposal…….
Thanks
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