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 $91,800. 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 $16,000 cash. 3. Diaz sold the machine for $34,800 cash. 4. Diaz sold the machine for $41,900 cash. View transaction list Journal entry worksheet 2 3 4 Record the disposal of the machine receiving nothing in return. Note: Enter debits before credits.

Explanation / Answer

No Accounting titles & Explanations Debit Credit 1) Accumulated Depreciation 91,800 loss on disposal 34,800 Machine 126,600 2) Cash 16,000 Accumulated Depreciation 91,800 loss on disposal 18,800 Machine 126,600 3) Cash 34,800 Accumulated Depreciation 91,800 Machine 126,600 4) Cash 41,900 Accumulated Depreciation 91,800 Gain on disposal 7,100 Machine 126,600

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