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The Pet Salon depreciated the fixtures on a straight-line basis, with $5,000 residual value. On May 31, 2020, Pet Salon sold the fixtures for $25,000 cash.
Record both depreciation expense for 2020 and sale of the fixtures on May 31, 2020.
Straight-line Depreciation method:
Market value of assets received Less: Book value of asset disposed of Cost Less: Accumulated Depreciation Gain or (Loss)
Date Description Debit Credit May 31 May 31 May 31 May 31 May 31 May 31 May 31
Market value of assets received 25,000.00 Less: Book value of asset disposed of Cost 46,400.00 Less: Accumulated Depreciation 12,506.25 33,893.75 Gain or (Loss) -8,893.75 Date Description Debit Credit May 31 Depreciation Exp-Fixture 2,156.25 May 31 Accum. Depr.-Fixture 2,156.25 May 31 Cash 25,000.00 May 31 Accum. Depr.-Fixture 12,506.25 May 31 Loss on Sale 8,893.75 May 31 Fixture 46,400.00