Long term assets - Disposal
3 important questions on Long term assets - Disposal
What is an entry that needs to be made when an asset is sold or disposed of?
Updating the depreciation to the sale/disposal date
When the asset is sold or scrapped, the accumulated depreciation account must be:
Debited (with any cash obtained)
What does a trade-in look like on the books?
Debits would be the new machine account, accumulated depreciation of the old asset, and perhaps any losses on the value of the old asset. Credits would include cash and the old asset account, as well as any gain on the old asset's book value.
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