Crane Company sells office equipment on July 31, 2022, for $20,440 cash. The office equipment originally cost $82,640 and as of January 1, 2022, had accumulated depreciation of $38,770. Depreciation for the first 7 months of 2022 is $4,250.Prepare the journal entries to (a) update depreciation to July 31, 2022, and (b) record the sale of the equipment. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) No. Account Titles and Explanation Debit Credit (a) Enter an account title to update depreciation to July 31 Enter a debit amount Enter a credit amount enter an account title to update depreciation to July 31 Enter a debit amount Enter a credit amount (b) Enter an account title to record the sale of the equipment Enter a debit amount Enter a credit amount Enter an account title to record the sale of the equipment Enter a debit amount Enter a credit amount Enter an account title to record the sale of the equipment Enter a debit amount Enter a credit amount Enter an account title to record the sale of the equipment
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
Crane Company sells office equipment on July 31, 2022, for $20,440 cash. The office equipment originally cost $82,640 and as of January 1, 2022, had
Prepare the
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No.
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Account Titles and Explanation
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Debit
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Credit
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(a)
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Enter an account title to update depreciation to July 31
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Enter a debit amount
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Enter a credit amount
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enter an account title to update depreciation to July 31
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Enter a debit amount
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Enter a credit amount
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(b)
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Enter an account title to record the sale of the equipment
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Enter a debit amount
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Enter a credit amount
|
|
Enter an account title to record the sale of the equipment
|
Enter a debit amount
|
Enter a credit amount
|
|
|
Enter an account title to record the sale of the equipment
|
Enter a debit amount
|
Enter a credit amount
|
|
|
Enter an account title to record the sale of the equipment
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