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Oriole Company sells office equipment on July 31, 2017, for $21,900 cash. The office equipment originally cost $76,780 and as of January 1, 2017, had accumulated depreciation of $36,270. Depreciation for the first 7 months of 2017 is $4,070. Prepare the journal entries to (a) update depreciation to July 31, 2017, and (b) record the sale of the equipment.

Respuesta :

Answer:

The journal entries are shown below:

Explanation:

The journal entries are as follows

a Depreciation expense $4,070  

           To Accumulated Depreciation $4,070

(Being the depreciation expense is recorded )  

b. Cash $21,900

Accumulated Depreciation $40,340   ($36,270 + $4,070)

Loss on sale of equipment $14,540       (Balancing figure)  

            To Equipment  $76,780

( To record the sale of equipment )  

Only these two entries are recorded)