ech-Google x C erto meducation com hm tpx E connect Ch. 10 Test Question 10 (of

Question

ech-Google x C erto meducation com hm tpx E connect Ch. 10 Test Question 10 (of 15 0.00 points Exercise 10-15 Disposal of property, plant, and equipment and intangible asses (00 On July 15, 2016, Cottonwood Industries sold a s patent and equipment to Roquemove Corporation for $910,000 and $405,000, respectively The book value of the patent and equipment on the date of sale were $200,000 and $496 000 (cost of $726,000 less accumulated depreciation of S230,000), respectively Required Prepare the joumai entries to record the sales of the patert and equipment (If no entry is required for a transactionlevent, select "No journal entry required" in the tirst account field.) Journal entry worksheet l Record the sale of the petent. TOSHIBA 2 3 4 5 6 tab 9

Explanation / Answer

Note: 1 CALCULATION OF THE PROFIT AND LOSS ON SALE OF PATENT AND EQUIPMENT Particulars Patent   Equipment Sale Price = $          9,10,000 $            4,05,000 Less: Book Value = $          2,00,000 $            4,96,000 Proft (Loss) on sale $          7,10,000 $              -91,000 Journal Entries Date Account Title and explanation Debit Credit Answer =1 Record the sale of Patent Cash $    9,10,000.00         To Patent $      2,00,000.00         To Profit on sale of Patent $      7,10,000.00 (To Record the sale of Patent) Answer =2 : Record the sale of Equipment Cash $    4,05,000.00 Loss on sale of Equipment $        91,000.00       To Equipment $      4,96,000.00 (To Record the loss on sale of equipment)

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