Question

Exercise 9-11 Cullumber Company owns equipment that cost $68,000 when purchased on January 1, 2019. It has been depreciated using the straight-line method based on an estimated salvage value of $8,000 and an estimated useful life of 5 years. Prepare Cullumber Company's journal entries to record the sale of the equipment in these four independent situations. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) (a) (b) (c) (d) Sold for $34,000 on January 1, 2022. Sold for $34,000 on May 1, 2022. Sold for $12,000 on January 1, 2022. Sold for $12,000 on October 1, 2022.

Answer 1

Date	General Journal	Debit	Credit
a	Cash	$   34,000
	Accumulated depreciation - Equipment ($68,000-8,000)5*3)	$   36,000
	Equipment		$   68,000
	Gain on sale of assets		$     2,000
b)	Depreciation expense ($68,000-8,000)/5*4/12)	$     4,000
	Accumulated depreciation - Equipment		$     4,000
	(To record depreciation expense)
	Cash	$   34,000
	Accumulated depreciation - Equipment ($68,000-8,000)5*3)+$4,000)	$   40,000
	Equipment		$   68,000
	Gain on sale of assets		$     6,000
c)	Cash	$   12,000
	Accumulated depreciation - Equipment ($68,000-8,000)5*3)	$   36,000
	Loss on sale of equipment	$   20,000
	Equipment		$   68,000
d)	Depreciation expense ($68,000-8,000)/5*9/12)	$     9,000
	Accumulated depreciation - Equipment		$     9,000
	(To record depreciation expense)
	Cash	$   12,000
	Accumulated depreciation - Equipment ($68,000-8,000)5*3)+$9,000)	$   45,000
	Loss on sale of assets	$   11,000
	Equipment		$   68,000

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