- Recording Fixed Asset Disposal On April 1 2020 One Of The Two Large Production Machines Used By Evert Company Stripped 1 (54 KiB) Viewed 59 times
- Recording Fixed Asset Disposal On April 1 2020 One Of The Two Large Production Machines Used By Evert Company Stripped 2 (38.64 KiB) Viewed 59 times
Recording Fixed Asset Disposal On April 1, 2020, one of the two large production machines used by Evert
Company stripped a gear, causing major internal damage. On April 5, 2020, the
company decided to purchase a new machine (cost of $91,250) so that 4 production could continue. On January 1, the accounts showed the following for the old machine: original cost, $45,000; accumulated depreciation, $31,500 (20-year life; no residual value). The
company did not accept a trade-in offer of $6,750. Instead, the old machine was sold on April 5 to another
company for $12,000. Evert spent $1,500 cleaning and $500 moving the machine prior to shipping. Insurance premiums (prepaid) on the old machine were $225; the unused portion of the premium is applied to the new machine. That insurance was paid on January 1 and covered the period January 1 through December 31. a. Record the entry for Evert
Company to purchase equipment on April 5, 2020. Date Account Name Dr. Cr. April 5, 2020 Equipment ✔ 91250 ✓ 0✔ Cash ✓ 0✔ 91250 b. Record the entries for Evert
Company on April 5, 2020, to dispose of the old machine, including any required updates for depreciation and for insurance expense. Note: Round your answers to the nearest whole number. Note: Record debit accounts in alphabetical order using the first letter of the account name.
b. Record the entries for Evert
Company on April 5, 2020, to dispose of the old machine, including any required updates for depreciation and for insurance expense. Note: Round your answers to the nearest whole number. Note: Record debit accounts in alphabetical order using the first letter of the account name. Date Account Name Dr. Cr. April 5, 2020 Depreciation Expense + x 0✔ 0✔ 777 x 0x 0✔ April 5, 2020 Insurance Expense 0✔ 0x Prepaid Insurance To record insurance. 777 * 0✓ April 5, 2020 Accumulated Depreciation 0x 0✓ Cash 0x 0✔ Loss on Disposal 0✔ 0x Equipment To record disposal. Chock Accumulated Depreciation To update depreciation. ✔ ✓ ♦ ✓ 000 + >>> ✔