Question

Which of the following could be a correct journal entry to record the disposition of equipment?

A. Dr.Cash
Dr.Loss on sale of equipment
Cr. Accumulated depreciation
Cr. Equipment
B. Dr.Gain on sale of equipment
Dr.Accumulated depreciation
Cr. Equipment
C. Dr.Cash
Dr.Loss on sale of equipment
Dr.Accumulated depreciation
Cr. Equipment
D. Dr.Accounts payable
Cr. Accumulated depreciation
Cr. Depreciation expense

Answer 1

The correct journal entry to record the disposition of equipment is option C: Dr. Cash, Dr. Loss on sale of equipment, Dr. Accumulated depreciation, Cr. Equipment.

Step-by-step explanation:

The correct journal entry to record the disposition of equipment is option C. The entry should be:

Dr. Cash

Dr. Loss on sale of equipment

Dr. Accumulated depreciation

Cr. Equipment

This entry reflects the cash received from the sale, the loss on the sale of the equipment, the accumulated depreciation being eliminated, and the removal of the equipment from the books.