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b. Transfer the profit or loss on disposal to the Profit and Loss account on 30 June. Note: As the accumulated depreciation has been provided at the date of sale, no further depreciation entries are required, and the Depreciation ledger account should have no entries General Ledger Extract Folio Debit Credit Balance N/A N/A 13,000 Date Details Machinery 30/11/XX Balance N/A 30/11/XX Machinery disposal N/A Accumulated Depreciation 30/11/XX Balance 30/11/XX Depreciation Bank 30/11/XX Balance N/A 30/11/XX Accounts receivable N/A dr GST Collected 30/11/XX Disposal N/A N/A Depreciation 30/11/XX Profit and loss N/A N/A Disposal 30/11/XX Machinery Accumulated N/A N/A depreciation Accounts receivable Profit on disposal N/A Profit on Disposal 30/11/XX Disposal N/A 30/06/XX Depreciation N/A 620,000 DR 25,000 595,000 DR 280,000 CR 267,000 CR General Journal – O'Reilly Pty Ltd Date Details 30/11/XX Disposal Machinery Transfer asset cost to Disposal Account 30/11/XX Accumulated depreciation (Machinery) Disposal Transfer asset accumulated depreciation to Disposal Account 30/11/XX Account receivable (Cash) Disposal GST collected Sale of asset to Jake Strong 30/11/XX Disposal Profit on disposal Profit on disposal of asset 30/6/XX Profit on disposal Profit and loss Transfer Profit on disposal of asset to Profit and Loss account Debit Credit 25,000 25,000 13,000 13,000 14,300 13,000 1,300 1,000 1,000 1,000 1,000

b. Transfer the profit or loss on disposal to the Profit and Loss account on 30 June. Note: As the accumulated depreciation has been provided at the date of sale, no further depreciation entries are required, and the Depreciation ledger account should have no entries General Ledger Extract Folio Debit Credit Balance N/A N/A 13,000 Date Details Machinery 30/11/XX Balance N/A 30/11/XX Machinery disposal N/A Accumulated Depreciation 30/11/XX Balance 30/11/XX Depreciation Bank 30/11/XX Balance N/A 30/11/XX Accounts receivable N/A dr GST Collected 30/11/XX Disposal N/A N/A Depreciation 30/11/XX Profit and loss N/A N/A Disposal 30/11/XX Machinery Accumulated N/A N/A depreciation Accounts receivable Profit on disposal N/A Profit on Disposal 30/11/XX Disposal N/A 30/06/XX Depreciation N/A 620,000 DR 25,000 595,000 DR 280,000 CR 267,000 CR General Journal – O'Reilly Pty Ltd Date Details 30/11/XX Disposal Machinery Transfer asset cost to Disposal Account 30/11/XX Accumulated depreciation (Machinery) Disposal Transfer asset accumulated depreciation to Disposal Account 30/11/XX Account receivable (Cash) Disposal GST collected Sale of asset to Jake Strong 30/11/XX Disposal Profit on disposal Profit on disposal of asset 30/6/XX Profit on disposal Profit and loss Transfer Profit on disposal of asset to Profit and Loss account Debit Credit 25,000 25,000 13,000 13,000 14,300 13,000 1,300 1,000 1,000 1,000 1,000

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter7: Operating Assets
Section: Chapter Questions
Problem 60E
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On 31 December, a finishing machine was sold.

Accumulated depreciation to 30 June was $10,000. The depreciation for 6 months ended 31 December was $3,000.

Its capital cost was $25,000 and accumulated depreciation was $13,000 at date of sale.

The machine was sold for cash to Jake Strong for $14,300 (including GST).

Balance date is 30 June.

using the general journal in image 1. complete the general ledger in image 2. 

 

b. Transfer the profit or loss on disposal to the Profit and Loss account on 30 June. Note: As the accumulated depreciation has been provided at the date of sale, no further depreciation entries are required, and the Depreciation ledger account should have no entries General Ledger Extract Folio Debit Credit Balance N/A N/A 13,000 Date Details Machinery 30/11/XX Balance N/A 30/11/XX Machinery disposal N/A Accumulated Depreciation 30/11/XX Balance 30/11/XX Depreciation Bank 30/11/XX Balance N/A 30/11/XX Accounts receivable N/A dr GST Collected 30/11/XX Disposal N/A N/A Depreciation 30/11/XX Profit and loss N/A N/A Disposal 30/11/XX Machinery Accumulated N/A N/A depreciation Accounts receivable Profit on disposal N/A Profit on Disposal 30/11/XX Disposal N/A 30/06/XX Depreciation N/A 620,000 DR 25,000 595,000 DR 280,000 CR 267,000 CR
Transcribed Image Text:b. Transfer the profit or loss on disposal to the Profit and Loss account on 30 June. Note: As the accumulated depreciation has been provided at the date of sale, no further depreciation entries are required, and the Depreciation ledger account should have no entries General Ledger Extract Folio Debit Credit Balance N/A N/A 13,000 Date Details Machinery 30/11/XX Balance N/A 30/11/XX Machinery disposal N/A Accumulated Depreciation 30/11/XX Balance 30/11/XX Depreciation Bank 30/11/XX Balance N/A 30/11/XX Accounts receivable N/A dr GST Collected 30/11/XX Disposal N/A N/A Depreciation 30/11/XX Profit and loss N/A N/A Disposal 30/11/XX Machinery Accumulated N/A N/A depreciation Accounts receivable Profit on disposal N/A Profit on Disposal 30/11/XX Disposal N/A 30/06/XX Depreciation N/A 620,000 DR 25,000 595,000 DR 280,000 CR 267,000 CR
General Journal – O'Reilly Pty Ltd Date Details 30/11/XX Disposal Machinery Transfer asset cost to Disposal Account 30/11/XX Accumulated depreciation (Machinery) Disposal Transfer asset accumulated depreciation to Disposal Account 30/11/XX Account receivable (Cash) Disposal GST collected Sale of asset to Jake Strong 30/11/XX Disposal Profit on disposal Profit on disposal of asset 30/6/XX Profit on disposal Profit and loss Transfer Profit on disposal of asset to Profit and Loss account Debit Credit 25,000 25,000 13,000 13,000 14,300 13,000 1,300 1,000 1,000 1,000 1,000
Transcribed Image Text:General Journal – O'Reilly Pty Ltd Date Details 30/11/XX Disposal Machinery Transfer asset cost to Disposal Account 30/11/XX Accumulated depreciation (Machinery) Disposal Transfer asset accumulated depreciation to Disposal Account 30/11/XX Account receivable (Cash) Disposal GST collected Sale of asset to Jake Strong 30/11/XX Disposal Profit on disposal Profit on disposal of asset 30/6/XX Profit on disposal Profit and loss Transfer Profit on disposal of asset to Profit and Loss account Debit Credit 25,000 25,000 13,000 13,000 14,300 13,000 1,300 1,000 1,000 1,000 1,000
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