Sale of a Fixed Asset
Below are two options for the sale of a Fixed Asset based on depreciation. You would complete a journal entry to record this transaction.
1) Fully depreciated:
Dr. Cash
Cr. Fixed asset
Dr. Accum. Depreciation
Cr. Gain on Sale
2) Partially depreciated:
Dr. Cash
Cr. Fixed asset
Dr. Accum. Depreciation
Cr. Gain on Sale *OR Dr. Loss on Sale
The gain or loss is the offset to the transaction so it depends on if the cash received is more or less than book value.
1) Fully depreciated:
Dr. Cash
Cr. Fixed asset
Dr. Accum. Depreciation
Cr. Gain on Sale
2) Partially depreciated:
Dr. Cash
Cr. Fixed asset
Dr. Accum. Depreciation
Cr. Gain on Sale *OR Dr. Loss on Sale
The gain or loss is the offset to the transaction so it depends on if the cash received is more or less than book value.