Question

Diaz Company owns a milling machine that cost $250,000 and has accumulated depreciation of $182,000. Prepare the entry to record the disposal of the milling machine on January 3 under each of the following independent situations. 1. The machine needed extensive repairs, and it was not worth repairing. Diaz disposed of the machine, receiving nothing in return.

Answer 1

Loss on Dispossal 68,000

Acc Depreciation 182,000

Milling Machine 250,000

Step-by-step explanation:

acquisition 250,000

acc depreciation (182,000)

book value 68,000

Because no return is possible for the milling machine all the book value will be considered a loss on dispossal

Loss on Dispossal 68,000

Acc Depreciation 182,000

Milling Machine 250,000