Question

Presented below are selected transactions at Ridge Company for 2017.

Jan.	1		Retired a piece of machinery that was purchased on January 1, 2007. The machine cost $64,500 on that date. It had a useful life of 10 years with no salvage value.
June	30		Sold a computer that was purchased on January 1, 2014. The computer cost $39,800. It had a useful life of 5 years with no salvage value. The computer was sold for $13,700.
Dec.	31		Discarded a delivery truck that was purchased on January 1, 2013. The truck cost $34,980. It was depreciated based on a 6-year useful life with a $3,000 salvage value.

Journalize all entries required on the above dates, including entries to update depreciation, where applicable, on assets disposed of. Ridge Company uses straight-line depreciation. (Assume depreciation is up to date as of December 31, 2016.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date	Account Titles and Explanation	Debit	Credit
Jan. 1June 30Dec. 31
Jan. 1June 30Dec. 31
	(To record depreciation to date of disposal)
June 30
	(To record sale of computer at a gain)
Jan. 1June 30Dec. 31
	(To record depreciation to date of disposal)
Dec. 31
	(To record retirement of truck at a loss)

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Answer 1

Date	Particulars	Debit ($)	Credit ($)
Jan 1	Accumulated depreciation – Equipment	64,500
	Equipment		64,500
	(To record depreciation to date of disposal)
June 30	Depreciation expense	3980
	Accumulated depreciation- equipment (39,800*1/5*6/12)		3980
	(To record depreciation)
June 30	Cash	13700
	Accumulated depreciation- equipment (39,800*3/5 + 3980)	27,860
	Gain on disposal of plant assets		1760
	Equipment		39,800
	(To record sale of computer at a gain)
Dec 31	Depreciation expense	5330
	Accumulated depreciation- equipment (34980-3000)/6		5330
	(To record deprication)
Dec 31	Loss on disposal	8330
	Accumulated depreciation- equipment ((34980-3000) X 5/6	26,650
	Equipment		34,980
	(To record retirement of truck at a loss)