Question - Disposal of Fixed Asset
Equipment acquired on January 4, 2009, at a cost of $320,200, has an estimated useful life of eight years and an estimated residual value of $41,800.
a. What was the annual amount of depreciation for the years 2009, 2010, and 2011, using the straight-line method of depreciation?
b. What was the book value of the equipment on January 1, 2012?
c. Assuming that the equipment was sold on January 9, 2012, for $205,000, journalize the entry to record the sale. If an amount box does not require an entry, leave it blank or enter "0".
d. Assuming that the equipment had been sold on January 9, 2012, for $220,100 instead of $205,000, journalize the entry to record the sale. If an amount box does not require an entry, leave it blank or enter "0".