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PilotLPTM
1 month ago
14

On December 29, 2019, Patel Products, Inc., sells a delivery van that cost $20,000. After recording the entry to bring the accum

ulated depreciation up-to-date, the delivery van had accumulated depreciation of $18,000. Patel received $2,000 cash from the purchaser of the delivery van.
Prepare the journal entry to record sales.
Business
1 answer:
soldi70 [3.4K]1 month ago
6 0

Answer: For an explanation, please refer to the explanation section

Explanation:

recording a journal entry for Patel Products selling a delivery van priced at $20,000 with accumulated depreciation totaling $18,000, while receiving $2,000 cash from the buyer, results in:

December 29, 2019

Account title----- Cash----------Debit $2,000

Account title----Accumulated Depreciation-----Debit $18,000.

Account title------Delivery Van ----Credit $20,000

The equipment's book value at the sale was $2,000, reflecting its original cost of $20,000 adjusted by the accrued depreciation of $18,000. Since Patel received the same $2,000 from the sale of the delivery van, there is no profit from the disposal.

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