Answered

Find expert advice and community support for all your questions on IDNLearn.com. Discover detailed answers to your questions with our extensive database of expert knowledge.

the black limo company (blc) sold a limo that had been used in it operations. the limo cost $48,000, had accumulated depreciation of $20,000, and was sold for $26,000. the journal entry to record the disposal of the limo includes a account. multiple choice question.

Sagot :

Varshamittal029idn

The following journal entry will be passed:

                    Bank A/C Dr.                                           $26,000

                    Accumulated Depreciation A/C Dr.       $20,000    

                    Loss on sale of Limo Account Dr.          $2,000

                                              To Balck Limo company A/C $48,000

Working Notes:

It has been given that,

                   Cost of Limo = $48,000

                    Accumulated Depreciation - $20,000

                    Sale Price of Limo = $26,000

It can be clearly seen that, when we deduct the depreciation, which has been accumulated since many years, from the cost of the limo, i.e.  $48,000 - $20,000 = $28,000. We get the remaining value of the value to be $28,000 as calculated. But the limo is then sold for an amount i.e., $26,000, which is lower than its current value, $28,000.

Since the sale value is less than the current value of the limo, there is a loss of $2,000 ($26,000 - $28,000).

Therefore, the loss of $2,000 will be debited to the loss in sale of limo account.

Learn more about Accumulated Depreciation here: https://brainly.com/question/1287985

#SPJ4

We appreciate your presence here. Keep sharing knowledge and helping others find the answers they need. This community is the perfect place to learn together. Discover the answers you need at IDNLearn.com. Thank you for visiting, and we hope to see you again for more solutions.