asset disposal

Asset Disposal

Transfer the cost of the asset being sold to asset disposal

Transfer the accumulated depreciation on the asset being sold to asset disposal

Record what you sold it for Calculate and record the profit or

loss made on the sale of the asset

Intro – the FOUR STEPS

1)

2)

3)4)

C

A

SP

Example 2

Example 3

Transfer the cost of the asset being sold to asset disposal

Calculate and record current depreciation on the asset being sold

Transfer the accumulated depreciation on the asset being sold to asset disposal

Record what you sold it for Calculate and record the profit or

loss made on the sale of the asset

An additional part to step 2

1)2)

3)4)

CA

SP

An additional part to step 2

Disposal Done now depreciate remaining

assets at year end!

Calculated! Now record:

Finish off - balancing

Draw a time line – plot the informationWork along the timeline, record transactions as they happen

For a Disposal: go according to 4 steps◦C ◦A <◦S◦P

When you get to year end:◦Calculate and record depr. on REMAINING assets

◦Balance and close accounts

To sum up

a) Curr deprb) Total acc depr