6 thoughts on “Journal Entry For Asset Disposals Step-by-step”

  1. Hi Putra,

    I’m a bit confuse about accounting chart. My disposal off asset should be a expenses or income in chart of account? I also need to know about loss and gain on sale account. i’m using UBS system.

    Please advise, Thank you so much,
    Mag

  2. Hi Putra,

    How should I treat the Disposal of damaged asset and it’s replacement through the Insurance Policy of “Replacement- Old for New”.

    Asset cost: $150,000 & Accumulated Depreciation: $87,000.
    Say the Insurance company replaces the asset and take possession of the damaged ones. The asset is replaced at a Fair Value of $147,000.

    Lastly, the replacement takes place at the end of the reporting period. Is there need to take up depreciation?

    I humbly await your reply. Thank you.

  3. Hi there,

    I have $63K worth the art work that the company did not depreciate. It was bad art work and we sold it at an employee auction for $2500. What would the entry be to dispose of these assets?
    DR Cash $2500
    DR expense other $60,500
    CR Asset account 63,000?

    Thanks so much.

  4. I incurred expenses (professional/lawyers fee) when disposing off an assets.say US 1,000. – is this other expense and where should i report this on the PL.. is this part of operating expenses or below it as “Other Expenses”

    Many thanks for the response

  5. what is the nature of asset disposal account.nominal or real.what happens when there is a scrap value to the asset.will the same entry persist. what about the balance in the asset disposal account.shall the amount be transferred to balance sheet. awaiting your reply

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