Question

On Januay 1, 2018, Rob's Bottie Factory purchased a new bottle-sealing machine for $118,000. The muchine had an estimated useful life of 10 yeara and is expected to have no residual value. The company uses straight-line depreciation. The asset is sold on January 1,2025 for $30,000. The foccal yeat end of Rob's Bottle Factory is December 31. Record the entry for the sale assuming that the depreciation for 2024 has already been recorded Do not enter dollar signs or commas in the input boxes. Round your answers to the nearest whole dollat Enter the debit accounts in alphabetical order and enter the credit accounts in alphabeticalorder. Round your answers to the nearest whole dollar

Answer 1

The entry for the sale of the bottle-sealing machine would include debiting Accumulated Depreciation and Loss on Sale of Asset, and crediting Bottle-Sealing Machine and Cash.

Step-by-step explanation:

When an asset is sold, the entry for the sale is recorded to remove the asset from the books and account for any gain or loss on the sale. In this case, the bottle-sealing machine is being sold for $30,000, which is below its original cost of $118,000. Since the machine is being sold for less than its cost, there will be a loss on the sale.

The entry to record the sale would be:

• Debit: Accumulated Depreciation - Bottle-Sealing Machine ($94,000)
• Debit: Loss on Sale of Asset ($24,000)
• Credit: Bottle-Sealing Machine ($118,000)
• Credit: Cash ($30,000)