E7-44 (Learning Objective 4: Determining the sale price of property and equipmen

Question

E7-44 (Learning Objective 4: Determining the sale price of property and equipment) Wilson Corporation reported the following for property and equipment (in millions, adapted): Year End 20x7 20x6 Property and equipment Accumulated depreciation $24,073$22.011 (13.306) (12,087) During 20X7, Wilson paid $2,510 mil lion for new property and equipment. Depreciation for the year totaled $1,546 million. During 20x7, Wilson sold propenty and equipment for cash of S48 million. How much was Wilson's gain or loss on the sale of property and equipment durino 20x77

Explanation / Answer

Calculation of Gain/(Loss) on sale of Property and Equipment during 20X7 Assets Account Particular    Amount (In Million $) Particular Amount (In Million $) To Balance B/d 22,011.00 By Bank A/c                    48.00 To Bank A/c 2,510.00 (Sale of Property and Equipment) (Purchase of Property and Equipment) By Depreciation A/c              1,546.00 To Gain on sale of Property and Equipment 1,146.00 By Balance C/d 24,073.00 (Balancing Figure) 25,667.00 25,667.00 Accumulated Depreciation Account Particular Amount (In Million $) Particular Amount (In Million $) To Depreciation 1,546.00 By Balance b/d 12,087.00 By Profit and Loss Account 2,765.00 To Balance C/d 13,306.00 (Balancing Figure) 14,852.00 14,852.00 Depreciation Account Particular Amount (In Million $) Particular Amount (In Million $) To Property and Equipment A/c 1,546.00 By Accumulated Depreciation Account              1,546.00 (Depreciation for the year) (Transfer to Accumulated Dep.Account) 1,546.00              1,546.00

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