Join BKN

Join BKN
Join BKN

Ideal Schools

Join BKN

The Book-keepers Forum -> General Book-keeping & Accounting -> Sale of Asset
Post Info TOPIC: Sale of Asset
KAZ


Veteran Member

Status: Offline
Posts: 27
Date:
Sale of Asset
 

My client recently sold an asset for less than its value.  How do I close down the remaining amount?



__________________
Count1314


Senior Member

Status: Offline
Posts: 115
Date:
 

You just write down the value of the asset and accumulated depreciation and the difference between these and the bank receipt is a loss on disposal on the P&L.

So.........

Cr Asset (original value)

Dr Accumulated Depreciation (to date)

Dr Bank (sale proceeds)

Cr Loss on disposal (the balance).



__________________

MarkS


Guru

Status: Offline
Posts: 987
Date:
 

Hi Count

The loss on disposal is a Dr entry not Cr.

To add figures to explain the journal

Buy an asset for £1k.  Depreciation to date £200.  Sell for £500.

In the books the asset has a value of £800 (£1k - £200).  It is sold for £500 therefore a book loss of £300 (£800 - £500) has been made.

Journal to records above

                                                            Dr                       Cr

Cost (BS)                                                                     £1000

Accum Depn (BS)                                £200

Bank (BS)                                           £500

Loss on Disposal (P&L)                      £300

 

Total                                                  £1000               £1000

Regards

MarkS



__________________

www.stewartaccountingservices.co.uk

Providing bookkeeping, accounting and taxation services to small and medium sized businesses.
Count1314


Senior Member

Status: Offline
Posts: 115
Date:
 

Yes of course it is!.....In my haste, I was just trying to balance the debits and credits without using fgiures. Of course you are right and any 'loss' would be a debit!



__________________
Page 1 of 1  sorted by
 
Quick Reply

Please log in to post quick replies.
The Book-keepers Forum -> General Book-keeping & Accounting -> Sale of Asset
Post to Facebook Tweet this page Post to Digg Post to Del.icio.us
Members Login
Username 
 
Password 
    Remember Me  

BKN Special Offers

 

Resources

Careers & Qualifications  Start Up Essentials  Marketing Centre   Software Reviews
What is a book-keeper  Register as Self-Employed Networking  Software Blog
 Home Study Courses  Money Laundering Local Accountants  
 Qualifications/ Associations  Data Protection Direct Marketing  
 Franchises  Registering as an agent  Telemarketing  
 College / Night School  PI Insurance  Directories  
 Recruitment  Stationery  Google  
     Twitter  
     Volunteer Work  

 

 

 

 

  		 

  		   

 

Copy Right Bookcert Limited