A company sold equipment at a loss.What is the impact on the balance sheet of removing the equipment account and its related accumulated depreciation account?

Question

Quizplus · Accepted Answer

When the equipment account and its related accumulated depreciation account are removed, it reduces the total assets of the company because these accounts represent the value of the equipment that was sold. As the company sold the equipment at a loss, the value of the equipment on the balance sheet would be higher than the amount received from the sale, which results in a decrease in total assets.

A Company Sold Equipment at a Loss