On 1st July 2002, Jessica Ltd purchased equipments for $130000 cash. It was estimated that the equipments would have a salvage value of $ 10000 and a useful life of six years. The corporation uses straight line method of amortization and has a December 31 year end.
Record the disposal of equipments on July 1 2006, under each of the following independent situations:
1. it was sold for $35500
2. It was sold for $42000
3. It was retired.
Solution to the problem is provided in M.S.Word file attached herewith in the following parts.
1. Accounting steps of sale and retirement of property are fully ...
The solution explains the accounting steps for the sale and retirement of property, plant and equipments and record journal entries for the given transactions.