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    mjohnson620's Avatar
    mjohnson620 Posts: 2, Reputation: 1
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    #1

    Nov 19, 2012, 01:56 PM
    J/E to record sale of company property
    Non-profit company:

    I am looking for the proper J/E to make for sale of company property expensed (not fixed asset) 10 years ago. Not sure of original cost etc.

    Also, if we give away a fixed asset fully depreciated is the entry simply?

    Accum depr (dr)
    Asset (cr)

    Thx
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 173
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    #2

    Nov 19, 2012, 04:15 PM
    Yes that would be an appropriate journal if there is no residual value however you say it has been sold so if the item is written off there was a profit on sale and these transactions would have to be dealt with as an extraordinary item as they adjust prior year reporting

    The question therefore becomes how was the asset disposed of and why do you want to retroactively write the item off. How do you know it is not already written off if this was 10 years ago and you don't have a record of original cost.
    mjohnson620's Avatar
    mjohnson620 Posts: 2, Reputation: 1
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    #3

    Nov 20, 2012, 07:27 AM
    Quote Originally Posted by paraclete View Post
    Yes that would be an appropriate journal if there is no residual value however you say it has been sold so if the item is written off there was a profit on sale and these transactions would have to be dealt with as an extraordinary item as they adjust prior year reporting

    The question therefore becomes how was the asset disposed of and why do you want to retroactively write the item off. How do you know it is not already written off if this was 10 years ago and you don't have a record of original cost.
    Thanks for your help and posting a response. Unfortunately I appear to have not been clear with my post. That was two separate questions. Can you or anyone provide an answer to my second question about the sale of company property previously expensed not depreciated. Thanks
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 173
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    #4

    Nov 20, 2012, 02:44 PM
    the question here is the materiality of the amount. If the amount is not material in relation to the companies business the item could be dealt with as non operating income. You would not attempt to write back the cost. When you adjust any prior year transaction then it is dealt with as an extraordinary item, prior year adjustment. There is really no point in making adjustments of the accounts for a ten year old item. If it is of material value then it would be an extraordinaty item
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