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    donzo's Avatar
    donzo Posts: 1, Reputation: 1
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    #1

    May 9, 2011, 03:42 PM
    Financial accounting(sale of fixed asset)
    A corporation fiscal year begins January 1 and ends December 31.On January 1,2001 this corporation purchased a machine for $11,000.00.It's estimated life is 10 years and the depreciation method being utilized is straight line.Please give the proper entries for the following situations;entries must show the asset being removed from the books.Salvage value is $1,000.00
    1)on June 30, 2002 the machine was completely destroyed by fire.The machine was insured and the actual amount received from the insurance company for reimbursement was $2,500.00
    2)Using the same criteria stated in the instructions;what would be the entry if you sold the same machine on August 31,2005 for 7,500.00 of cash
    3)what would be the entry if the corporation sold the machine on September 30,2005 but received $7,000.00
    Just Looking's Avatar
    Just Looking Posts: 1,610, Reputation: 480
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    #2

    May 9, 2011, 06:55 PM

    Please read this first.

    Announcement:

    The place to start with this problem is to compute the depreciation, and then the book value. If you'll do that and post your answers we can check them and go from there. Thanks.
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