Question

2. Sale of PPE

Eastman Kodak reported that the cost of its PPE on December 31, 2010 was $6,805 million. On January 1, 2010, it had been $7,327 million. Also, the balance of accumulated depreciation on December 31, 2010 was $5,254 million. On January 1, 2010, it had been $5,516 million. Depreciation expense for the fiscal year 2010 was $420 million. During 2010, the company bought new equipment with acquisition cost of $254 million worth. The company also sold PPE and reported a $14 million gain on selling PPE.

Questions:

How much did Kodak sell its PPE for (sale price)?

Answer 1

Ans.	Property, Plant & Equipment (P P E) Account
	Particulars	Amount	Particulars	Amount
	To balance b/d (beginning)	$7,327,000,000	By Accumulated depreciation	$420,000,000
	To bank (purchase of equipment)	$254,000,000	By bank (sale of equipment , balancing fig.)	$370,000,000
	To gain on sale of equipment	$14,000,000	By balance c/d (ending)	$6,805,000,000
		$7,595,000,000		$7,595,000,000
	Accumulated Depreciation Account
	Particulars	Amount	Particulars	Amount
	To P P E	$420,000,000	By balance b/d (beginning)	$5,516,000,000
	To balance c/d (ending)	$5,254,000,000	By profit & loss (balancing fig.)	$158,000,000
		$5,674,000,000		$5,674,000,000
	So, the Sale of equipment   =   $370,000,0000     or $370 million.