Diaz Company owns a milling machine that cost $126,600 and has accumulated depre

Question

Diaz Company owns a milling machine that cost $126,600 and has accumulated depreciation of $94,200. Prepare the entry to record the disposal of the milling machine on January 3 under each of the following independent situations. 1. The machine needed extensive repairs, and it was not worth repairing. Diaz disposed of the machine, receiving nothing in return 2. Diaz sold the machine for $17,500 cash. 06 3. Diaz sold the machine for $32,400 cash. 4. Diaz sold the machine for $41,400 cash View transaction list Record the disposal of the machine receiving nothing in return. 1 2 Record the sale of the machine for $17,500 cash. Record the sale of the machine for $32,400 cash. Record the sale of the machine for $41,400 cash 3 4 Prev 70, 9??? Next > to search

Explanation / Answer

Date General Journal Debit ($) Credit ($) 1. Record the disposal of machine receiving nothing in return January 3 Accumulated depreciation - Milling machine 94,200 Loss on disposal of milling machine [$126,600 - $94,200] 32,400 Milling machine 126,600 2. Record the sale of the machine for $17,500 cash January 3 Cash 17,500 Accumulated depreciation - Milling machine 94,200 Loss on disposal of milling machine [$126,600 - $94,200 - $17,500] 14,900 Milling machine 126,600 3. Record the sale of the machine for $32,400 cash January 3 Cash 32,400 Accumulated depreciation - Milling machine 94,200 Milling machine 126,600 4. Record the sale of the machine for $41,400 cash January 3 Cash 41,400 Accumulated depreciation - Milling machine 94,200 Milling machine 126,600 Gain on disposal of milling machine [$41,400 - ($126,600 - $94,200)] 9,000

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