Accounting for the Disposal of Fixed Assets

Pets Unlimited had a piece of equipment that it purchased 10 years ago. Its cost was $110,000 and it had accumulated depreciation of $75,000.

Requirements:

Use the following Excel Template to record the disposition of the asset under the following independent situations:

Pets Unlimited sold the equipment for $25,000.

Pets Unlimited discarded the equipment at a cost of $10,000.

Pets Unlimited traded in the asset for a new similar asset with a list price of $120,000. Pets Unlimited was given $10,000 as a trade-in allowance and paid cash for the balance.

Pets unlimited traded in the asset for a new similar asset with a list price of $200,000. Pets Unlimited was given a trade-in allowance of $50,000 and signed a note payable for the remainder.