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When a company sells machinery at a price equal to its book value, this transaction would be recorded with an entry that would include the following: debit Cash and Accumulated Depreciation; credit Machinery debit Cash and Machinery; credit Accumulated Depreciation debit Machinery; credit Cash and Accumulated Depreciation debit Cash and Depreciation Expense; credit Accumulated Depreciation

Respuesta :

Answer:

Correct option (a)

Explanation:

When a machinery is sold at book value, no gain or loss is recognized in the transaction. The depreciation expense accumulated throughout the period is removed. So, accumulated depreciation is debited. Similarly, cost of machinery is also removed by crediting it.

Cash received is debited as increase in assets are debited. Journal entry to record the same is:

Particulars                             Debit                Credit

Cash                                       XXXX

Accumulated depreciation    XXX

         Machinery                                              XXXX

(To record disposing off

machinery at book value)

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