The General Fund receives $5,000 from the sale of equipment that originally cost $4,000 and had accumulated depreciation associated with it of $3,000. The government should report a $4,000 on sale of equipment in the General Fund.

Question

Quizplus · Accepted Answer

Capital assets are not reported in the General Fund. Therefore, capital assets used in the General Fund are not written off. The General Fund must account for the receipt of the cash-a financial asset-by debiting Cash for $5,000 and crediting Other financing sources-proceeds from the sale of general capital assets for $5,000.

The General Fund Receives $5,000 from the Sale of Equipment