On 30 November 2015 a finishing machine was sold.
Its capital cost was $25,000 and accumulated depreciation was $13,000 at date of sale. Tip: Accumulated depreciation has been provided up to the date of sale. Thus no further depreciation is required to be recorded.
The machine was sold on credit to Jake Strong for $14,300 (including GST) with the purchaser paying a $1,000 deposit.
Balance date is 30 June 2016.
Required:
(a) Record General Journal entries to account for the sale of the finishing machine and post to the relevant ledger accounts.
(b) Transfer the profit or loss on disposal to the Profit and Loss account at 30 June.
Tip: as the accumulated depreciation has been provided at the date of sale, no further depreciation entries are required, and the Depreciation ledger account should have no entries.