General Journal DateDetailsGeneral Ledger Subsidiary Ledger DebitCreditDebitCredit Vehicle35000 gst3500 Creditor - Best Cars Purchase of a vehicle on credit Inv 376 38500 The General Journal Entries Buying a Car on Credit
Transfer assets historical cost to the Disposal of Asset account Transfer accumulated depreciation to Disposal of Asset account Show amount received from sale of asset in Disposal account Close the Disposal of Asset account to the Profit or Loss on sale of the asset.
Item is not popular therefore little demand May be obsolete technologically (eg computer) It may be damaged or severely marked The accumulated depreciation may not have been accurate. A loss will be reported as an expense in the Profit and Loss statement
Reported as a profit, under Other Revenue in Profit and Loss Statement Recorded in sundries column in cash receipts journal
Transfer of historical cost is the same as under sale of non-current assets Accumulated depreciation is transferred the same way Trade in allowance is a debit entry in Sundry Creditors account Loss on sale is the same Final general journal entry records the purchase of the new non-current asset
Carrying value/book value Loss on disposal of asset Proceeds from sale of asset Profit on disposal of asset Sundry creditor