Question

On January ​2, 2017​, Snug Clothing Consignments purchased showroom fixtures for $ 12 comma 000 ​cash, expecting the fixtures to remain in service for five years. Snug has depreciated the fixtures on a​ double-declining-balance basis, with zero residual value. On September 30 comma 2018​, Snug sold the fixtures for $ 6 comma 200 cash. Record both depreciation expense for 2018 and sale of the fixtures on September 30​, 2018. ​(Record debits​ first, then credits. Select the explanation on the last line of the journal entry table. Note that 2017 depreciation was recorded and posted in 2017​.) Begin by recording the depreciation expense for January​ 1, 2018 through September 30​, 2018. Date Accounts and Explanation Debit Credit Sep. 30 Depreciation Expense—Fixtures 2,160 Accumulated Depreciation—Fixtures 2,160 To record depreciation on fixtures. Before recording the sale of the​ fixtures, let's calculate any gain or loss on the sale of the fixtures. Market value of assets received $6,200 Less: Book value of asset disposed of Cost $12,000 Less: Accumulated Depreciation 7200 4800 Gain or (Loss) 1400

Answer 1