2. Debits and Credits Disposition / Sale of Plant Assets

Entry to dispose a fully depreciated plant asset

Debit Accumulated Depreciation - Plant Asset for accumulated depreciation amount, Credit Plant Asset for same amount

Entry to dispose a plant asset that is not fully depreciated

Debit Accumulated Depreciation for amount of accumulated depreciation, Debit Loss on Disposal of Plant asset for original cost - accumulated depreciation, Credit Plant asset for full amount

Selling an asset that has not fully depreciated at book value (no gain or loss)

Debit Cash for amount of cash received, Debit Accumulated Depreciation for amount of Accumulated Depreciation, Credit Equipment for full cost of equipment

Selling an asset that has not fully depreciated at a loss

Debit Cash for amount of cash received, Debit Accumulated Depreciation for amount of Accumulated Depreciation, Debit Loss on sale of equipment for loss, Credit Equipment for full cost.

Selling an asset that has not fully depreciated at a gain

Debit Cash for cash received, Debit Accumulated Depreciation for amount of Accumulated depreciation, Credit Equipment for full cost, Credit Gain on Sale of Equipment for amount of cash received above book value of equipment.

Entry to record depreciation on the date of sale

Debit Depreciation expense for amount of depreciation, Credit Accumulated Depreciation - Equipment