The balance sheet of Marty Ltd at 31 December 2012 showed: 1.
$\begin{array}{ll}&\$\
\text {Equipment } & 50,000 \
\text { Accumulated Depreciation-Plant } & 35,000\&15,000
\end{array}$ On 1 January 2013 the equipment was sold for $10 000.The accounting entry to record the closing of the equipment and the accumulated depreciation of equipment accounts is:

Question

Quizplus · Accepted Answer

When an asset is sold, the carrying amount of the asset (net of accumulated depreciation) is removed from the balance sheet. In this case, the carrying amount of the equipment is $15,000 ($50,000 - $35,000). The accumulated depreciation account is also closed out, with a debit of $35,000. The equipment account is then credited for the total of the carrying amount and the accumulated depreciation, which is $50,000.

The Balance Sheet of Marty Ltd at 31 December 2012 $Equipment 50,000 Accumulated Depreciation-Plant 35,00015,000\begin{array}{ll}&\$\\\text {Equipment } & 50,000 \\\text { Accumulated Depreciation-Plant } & 35,000\\&15,000\end{array}Equipment Accumulated Depreciation-Plant ​$50,00035,00015,000​

The Balance Sheet of Marty Ltd at 31 December 2012 $\begin{array}{ll}&\$\\\text {Equipment } & 50,000 \\\text { Accumulated Depreciation-Plant } & 35,000\\&15,000\end{array}$