Question 8 1 pts [Reviewl In 2018, Meyer sold a piece of equipment originally ac

Question

Question 8 1 pts [Reviewl In 2018, Meyer sold a piece of equipment originally acquired for $45,000. It sold the equipment for $21,000 in cash. On the date of sale, the amount of accumulated depreciation on the equipment was $25,000. How should Meyer record the sale? DEBIT CREDIT 21,000 45,000 Cash Equipment Gain on sale of equipment Accumulated depreciation 41,000 25,000 CREDIT Accumulated depreciation - equipmentEBI Accumulated depreciation- equipment Loss on sale of equipment 25,000 1,000 Equipment Cash 45,000 21,000 DEBIT CREDIT 21,000 25,000 Accumulated depreciation Gain on sale of equipment Equipment 1,000 45,000 Equipment expense Equipment DEBIT CREDIT 8,000 35,000 Accumulated depreciation - equipment Gain on sale of equipment 25,000 18,000

Explanation / Answer

Answer:

Equipment cost = 45000

Accumulated depreciation = 25000

Net WDV = 45000 - 25000 = 20000

Sale value = 21000

Gain on sale = 21000 - 20000 = 1000

Entry:

Cash                    21000

Accumulated depreciation - equipment 25000

           To Gain on sale                                      1000

           To Equipment                                       45000

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