Extracted text: Sheridan Company owns equipment that cost $68,520 when purchased on January 1, 2019....

Question

Extracted text: Sheridan Company owns equipment that cost $68,520 when purchased on January 1, 2019. It has been depreciated using the straight-
line method based on estimated salvage value of $6,000 and an estimated useful life of 5 years.
Prepare Sheridan Company's journal entries to record the sale of the equipment in these four independent situations. (List all debit
entries before credit entries. 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 O for the amounts.)
(a)
Sold for $32,512 on January 1, 2022.
(b)
Sold for $32,512 on May 1, 2022.
(c)
Sold for $10,100 on January 1, 2022.
(d)
Sold for $10,100 on October 1, 2022.
No. Account Titles and Explanation
Debit
Credit
(a)
(b)
(To record depreciation)
(To record sale of equipment)
(c)
(d)
(To record depreciation)
(To record sale of equipment)

Sandeep · Accepted Answer

Sheet1
		Depreciation Expense	(Cost - Salvage Value )/Useful Life of Assest
			68520-6000/5
			12504
		Depreciation for 3 years	12504*3					1042
			37512					4168
		Book Value of equipment	31008
	Ans a
		Date 	Account Description	Debit 	Credit
			Cash A/c	32512
			Accumulated Depreciation A/c	37512
			To Equipment		68520
			To Gain on sale of Equipment		1504
			(Being Sale of Equipment)
	Ans b	Date 	Account Description	Debit 	Credit
			Depreciation Expense A/c	4168
			To Accumulated Depreciation A/c (12504/12*4)		4168
			(Being the Amount of Depreciation recorded )
		Date 	Account Description	Debit 	Credit
			Cash A/c	32512
			Accumulated Depreciation A/c	41680
			To Equipment		68520
			To Gain on sale of Equipment		5672
			(Being recording the Sale of Equipment)
	Ans c
		Date 	Account Description	Debit 	Credit
			Cash A/c	10100
			Accumulated Depreciation A/c	37512
			Loss on sale of Equipment	20908
			To Equipment		68520
			(Being recording the Sale of Equipment)
	Ans d
		Date 	Account Description	Debit 	Credit
			Depreciation Expense A/c	9378
			To Accumulated Depreciation A/c (12504/12*9)		9378
			(Being the Amount of Depreciation recorded )
		Date 	Account Description	Debit 	Credit
			Cash A/c	10100
			Accumulated Depreciation A/c	46890
			Loss on sale of Equipment	11530
			To Equipment		68520
			(Being recording the Sale of Equipment)

Sheridan Company owns equipment that cost $68,520 when purchased on January 1, 2019. It has been depreciated using the straight- line method based on estimated salvage value of $6,000 and an estimated...

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