No. Account Titles and Explanation Debit Credit (To record depreciation) (To rec

Question

No.

Account Titles and Explanation

Debit

Credit

(To record depreciation)

(To record sale of equipment)

(To record depreciation)

(To record sale of equipment)

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SUBMIT ANSWER

Pryce Company owns equipment that cost $70,500 when purchased on January 1, 2014. It has been depreciated using the straight-line method based on an estimated salvage value of $4,300 and an estimated useful life of 5 years.

Prepare Pryce Company’s journal entries to record the sale of the equipment in these four independent situations. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g.125. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
(a) Sold for $34,720 on January 1, 2017. (b) Sold for $34,720 on May 1, 2017. (c) Sold for $10,300 on January 1, 2017. (d) Sold for $10,300 on October 1, 2017.

No.

Account Titles and Explanation

Debit

Credit

(a)

(b)

(To record depreciation)

(To record sale of equipment)

(c)

(d)

(To record depreciation)

(To record sale of equipment)

Explanation / Answer

Depreciation expense = (70500-4300)/5 13240 No Date Account titles and explanations Debit Credit a) 1/1/2017 Cash 34,720 Accumulated depreciaiton (13240*3) 39720 Gain on sale of Equipment 3,940 Equipment 70,500 b) 5/1/2017 Depreciation expense 4413 Accumulated depreciation (13240*4/12) 4,413 Cash 34,720 Accumulated depreciaiton (39,720+4413) 44133 Gain on sale of Equipment 8,353 Equipment 70,500 c) 1/1/2017 Cash 10,300 Accumulated depreciaiton (13240*3) 39720 Loss on sale of Equipment 20,480 Equipment 70,500 d) 10/1/2017 Depreciation expense 9930 Accumulated depreciation (13240*9/12) 9,930 Cash 10,300 Accumulated depreciaiton (39,720+9930) 49650 loss on sale of Equipment 10,550 Equipment 70,500

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