Howarth Manufacturing Company purchased a lathe on June 30, 2009, at a cost of $95,000. The residual value of the lathe was estimated to be $5,000 at the end of a five-year life. The lathe was sold on March 31, 2013, for $21,000. Howarth uses the straight-line depreciation method for all of its plant and equipment. Partial-year depreciation is calculated based on the number of months the asset is in service.
| 1. |
Prepare the journal entry to record the sale. (If no entry is required for a event, select "No journal entry required" in the first account field.)
| Event |
General Journal |
Debit |
Credit |
| 1 |
Accumulated Depreciation - Lathe |
|
|
|
Cash |
|
|
| 2. |
Assuming that Howarth had instead used the sum-of-the-years'-digits depreciation method, prepare the journal entry to record the sale. (If no entry is required for a event, select "No journal entry required" in the first account field.)
| Event |
General Journal |
Debit |
Credit |
| 1 |
Accumulated Depreciation -Lathe |
|
|
|
Cash |
|
|
|
|