{"id":3139,"date":"2023-10-04T11:58:40","date_gmt":"2023-10-04T11:58:40","guid":{"rendered":"http:\/\/localhost\/ecole9ja\/?p=3139"},"modified":"2023-10-04T12:01:08","modified_gmt":"2023-10-04T12:01:08","slug":"week-6-and-7-ss2-second-term-financial-accounting-notes","status":"publish","type":"post","link":"https:\/\/ecolebooks.com\/nigeria\/posts\/week-6-and-7-ss2-second-term-financial-accounting-notes\/","title":{"rendered":"Week 6 and 7 &#8211; SS2 Second Term Financial Accounting Notes"},"content":{"rendered":"<p>\u00a0<strong>WEEK SIX AND SEVEN                                                      \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0DATE: ______________<br \/>\n<\/strong><strong>TOPIC: DISPOSAL OF FIXED ASSETS<br \/>\n<\/strong><strong>CONTENT<br \/>\n<\/strong><\/p>\n<ul>\n<li>\n<div>Meaning and definition of disposal of fixed asset\n<\/div>\n<\/li>\n<li>\n<div>Methods of disposal of fixed assets and their format.\n<\/div>\n<\/li>\n<li>\n<div>Practical illustration.\n<\/div>\n<\/li>\n<\/ul>\n<p><strong>MEANING AND DEFINITION OF DISPOSAL OF FIXED ASSETS.<br \/>\n<\/strong>Fixed assets can be sold in the course of the business due to one reason or the other. The sale of fixed assets is recorded in an account called Assets Disposal Account and it is meant to show the profit or loss made on the sales of such a fixed asset. The accounting procedures on the sale of fixed asset are shown below.<\/p>\n<p>\u00a0<strong>METHOD OF DISPOSAL OF FIXED ASSET<br \/>\n<\/strong>There are two methods of recording disposal of fixed asset. They are the old and new methods of depreciation, on the asset sold <\/p>\n<p>\u00a0<strong>The old method:<br \/>\n<\/strong>Which depreciation has been credited to the asset account and the asset is disposed, then:<br \/>\na.\u00a0\u00a0\u00a0\u00a0For sale of asset:<br \/>\n\u00a0\u00a0\u00a0\u00a0i.\u00a0\u00a0\u00a0\u00a0Debit cash book<br \/>\n\u00a0\u00a0\u00a0\u00a0ii.\u00a0\u00a0\u00a0\u00a0Credit asset account<br \/>\nb.\u00a0\u00a0\u00a0\u00a0If there is profit on sale:<br \/>\n\u00a0\u00a0\u00a0\u00a0i.\u00a0\u00a0\u00a0\u00a0Debit asset account<br \/>\n\u00a0\u00a0\u00a0\u00a0ii.\u00a0\u00a0\u00a0\u00a0Credit profit and loss account<br \/>\nc.\u00a0\u00a0\u00a0\u00a0If here is loss on sale:<br \/>\n\u00a0\u00a0\u00a0\u00a0i.\u00a0\u00a0\u00a0\u00a0Debit profit &amp; loss account<br \/>\n\u00a0\u00a0\u00a0\u00a0ii.\u00a0\u00a0\u00a0\u00a0Credit asset account.<br \/>\n<strong>Example<br \/>\n<\/strong><strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Asset account\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\n19xx\u00a0\u00a0\u00a0\u00a0Bal b\/d\u00a0\u00a0\u00a0\u00a0x\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a019xx Cash book\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x<br \/>\n\t\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Profit\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x<br \/>\n\t\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0xx\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0xx<\/p>\n<p>\u00a0<strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Cash book\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 N\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\n19xx\u00a0\u00a0\u00a0\u00a0Asset\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x<\/p>\n<p>\u00a0<strong>DR<\/strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<strong>Profit &amp; Loss Account\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\n19xx\u00a0\u00a0\u00a0\u00a0Loss on sale of asset \u00a0\u00a0\u00a0\u00a0x\u00a0\u00a0\u00a0\u00a0Profit on sale of asset\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x<\/p>\n<p>\u00a0<strong>New method<br \/>\n<\/strong>Where depreciation has been carried to provision for depreciation account. It is best dealt with by opening a disposal account to which the original cost of assets and accumulated depreciation are transferred.<\/p>\n<ol>\n<li>\n<div>For cost price of assets:\n<\/div>\n<ol>\n<li>\n<div>Debit asset disposal account\n<\/div>\n<\/li>\n<li>\n<div>Credit asset account\n<\/div>\n<\/li>\n<\/ol>\n<\/li>\n<li>\n<div>For accumulated depreciation:\n<\/div>\n<ol>\n<li>\n<div>Debit provision for depreciation account\n<\/div>\n<\/li>\n<li>\n<div>Credit asset disposals account\n<\/div>\n<\/li>\n<\/ol>\n<\/li>\n<li>\n<div>For cash or cheque received on sale:\n<\/div>\n<ol>\n<li>\n<div>\u00a0\u00a0\u00a0\u00a0 Debit cash book\n<\/div>\n<\/li>\n<\/ol>\n<p>ii.\u00a0\u00a0\u00a0\u00a0Credit asset disposal\n<\/li>\n<li>\n<div>For profit on sale:\n<\/div>\n<ol>\n<li>\n<div>Debit asset disposal account\n<\/div>\n<\/li>\n<li>\n<div>Credit profit and loss account\n<\/div>\n<\/li>\n<\/ol>\n<\/li>\n<li>\n<div>For loss on sale:\n<\/div>\n<ol>\n<li>\n<div>Debit profit and loss account\n<\/div>\n<\/li>\n<li>\n<div>Credit asset disposal account\n<\/div>\n<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n<p>\u00a0<strong>Example<br \/>\n<\/strong><strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Asset Account\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\n19xx\u00a0\u00a0\u00a0\u00a0Cash\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x\u00a0\u00a0\u00a0\u00a019xx Asset disposal\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x<\/p>\n<p>\u00a0<strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Provision for depreciation account\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong>19xx\u00a0\u00a0\u00a0\u00a0Asset disposal\u00a0\u00a0\u00a0\u00a0x\u00a0\u00a0\u00a0\u00a019xx Accumulated  Bal b\/d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x<\/p>\n<p>\u00a0<strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Asset Disposal Account\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\n19xx\u00a0\u00a0\u00a0\u00a0Cost of asset\u00a0\u00a0\u00a0\u00a0x\u00a0\u00a0\u00a0\u00a019xx\u00a0\u00a0\u00a0\u00a0Cash realized\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x<br \/>\n19xx\u00a0\u00a0\u00a0\u00a0Profit\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x\u00a0\u00a0\u00a0\u00a019xx Prov. For dep.\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x<br \/>\n\t\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0X\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x<\/p>\n<p>\u00a0<strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Cash Book\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong><strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/strong>N\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\n19xx\u00a0\u00a0\u00a0\u00a0Asset disposal\u00a0\u00a0\u00a0\u00a0x<\/p>\n<p>\u00a0<strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Profit &amp; Loss Account\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong><strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/strong>N\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Profit on sale of asset\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0x<\/p>\n<p>\u00a0<strong>EVALUATION<br \/>\n<\/strong>1.\u00a0\u00a0\u00a0\u00a0State seven methods of charging depreciation on fixed assets<br \/>\n2.\u00a0\u00a0\u00a0\u00a0Explain five factors that are taken into consideration in determining annual depreciation charge.<\/p>\n<p>\u00a0<strong>Practical illustration<br \/>\n<\/strong>A motor car was bought for N30,000, it is to be depreciated at 25% on cost for 3 years and was sold for N10,000 at the end of the 3<sup>rd<\/sup> year. Prepare necessary account for the asset disposed off.<br \/>\n<strong>Solution<br \/>\n<\/strong>Using the straight line method of depreciation<br \/>\nMotor van.\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N30,000<br \/>\nYr 1 dep. (25%)\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0    7,500<br \/>\n\t\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0          N 22,500<br \/>\nYr 2 dep. (25%)\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0    7,500\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N15,000<br \/>\nYr 3 dep. (25%)\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0    7,500<br \/>\n\tNet Book Value (NBV)\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0  N7,500<\/p>\n<p>\u00a0<strong>Old Method<br \/>\n<\/strong><strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Motor van account\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong><img decoding=\"async\" align=\"left\" src=\"https:\/\/ecolebooks.com\/nigeria\/wp-content\/uploads\/9jalessonsimages\/100423_1158_Week6and71.png\" alt=\"\"\/>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\nYear 1 Cash\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a030,000\u00a0\u00a0\u00a0\u00a0Year 1 Depreciation\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a07,500<br \/>\n\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Bal c\/d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0       22,500<br \/>\n\t\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a030,000\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0       30,000<br \/>\n\tYr 2 Bal b\/d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a022,500\u00a0\u00a0\u00a0\u00a0Yr 2 Depreciation\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0         7,500<br \/>\n\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Bal c\/d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0       15,000<br \/>\n\t\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a022,500\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0       22,500<\/p>\n<p>\u00a0Yr 3 \u00a0\u00a0\u00a0\u00a0Bal b\/d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a015,000\u00a0\u00a0\u00a0\u00a0Yr 3 Depreciation\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0         7,500<br \/>\n\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Bal c\/d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0         7,500<br \/>\n\t\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a015,000\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0       15,000<br \/>\n\tYr 4 \u00a0\u00a0\u00a0\u00a0Bal b\/d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 7,500\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Yr 4 \u00a0\u00a0\u00a0\u00a0Cash book\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0       10,000<br \/>\n\tProfit sal\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 2,500<br \/>\n\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0        10,000\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0       10,000<\/p>\n<p>\u00a0<strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Cash Book\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\nYr 4 Motor van\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a010,000<br \/>\n<strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Profit And Loss Account\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\nYr 1 Depreciation\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a07,500\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Profit on sales\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a02,500<br \/>\nYr 2 Depreciation\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a07,500<br \/>\nYr 3 Depreciation\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a07,500<\/p>\n<p>\u00a0<strong>The Modern Method<br \/>\n<\/strong><strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Motor van Account \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong><strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/strong>N<strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/strong>N<strong><br \/>\n\t\t<\/strong>Yr 1 \u00a0\u00a0\u00a0\u00a0Cash\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a030,000\u00a0\u00a0\u00a0\u00a0Yr 3\u00a0\u00a0\u00a0\u00a0Asset disposal\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a030,000<\/p>\n<p>\u00a0<strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Provision for depreciation account  \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\nyr 1 \u00a0\u00a0\u00a0\u00a0Bal c\/d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a07,500\u00a0\u00a0\u00a0\u00a0Yr 2 \u00a0\u00a0\u00a0\u00a0Profit &amp; Loss\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0  \u00a0\u00a0\u00a0\u00a07,500<br \/>\nyr 2\u00a0\u00a0\u00a0\u00a0Bal c\/d\u00a0\u00a0\u00a0\u00a0       \u00a0\u00a0\u00a0\u00a015,000\u00a0\u00a0\u00a0\u00a0Yr 2 \u00a0\u00a0\u00a0\u00a0Bal b\/d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0  \u00a0\u00a0\u00a0\u00a07,500<br \/>\n\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Profit &amp; loss\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a07,500<br \/>\n\t\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a015,000\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a015,000<br \/>\n\tYear 3\u00a0\u00a0\u00a0\u00a0Bal c\/d      22,500\u00a0\u00a0\u00a0\u00a0Yr 3 \u00a0\u00a0\u00a0\u00a0Bal b\/d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a015,000<br \/>\n\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Profit &amp; loss\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0  7,500<br \/>\n\t\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0       \u00a0\u00a0\u00a0\u00a022,500\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a022,500<br \/>\n\tYr 4\u00a0\u00a0\u00a0\u00a0Asset disposal    22,500\u00a0\u00a0\u00a0\u00a01\/1Yr 4 Balance b\/d\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a022,500<\/p>\n<p>\u00a0<strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Asset Disposal Account  \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<\/strong><br \/>\n\t\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\nYr 1 Cost of assets\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a030,000\u00a0\u00a0\u00a0\u00a0Yr 4 Cash\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a010,000\u00a0\u00a0\u00a0\u00a0<br \/>\nProfit\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0  2,500\u00a0\u00a0\u00a0\u00a0Prov. For dep.\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a022,500<\/p>\n<p>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a032,500\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a032,500<\/p>\n<p>\u00a0<strong>DR\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Profit and loss account  \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0CR<br \/>\n<\/strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0N<br \/>\nYr 1 Depreciation \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a07,500\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Profit on sal\u00a0\u00a0\u00a0\u00a0e.\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a02,500<br \/>\n\tYr 2 Depreciation\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a07,500<br \/>\nYr 3 Depreciation\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a07,500\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/p>\n<p>\u00a0<strong>EVALUATION<br \/>\n<\/strong>1.\u00a0\u00a0\u00a0\u00a0Define disposal of fixed assets.<br \/>\n2.\u00a0\u00a0\u00a0\u00a0Mention the two methods of disposal of fixed assets.<\/p>\n<p>\u00a0<strong>READING ASSIGNMENT<br \/>\n<\/strong>1.\u00a0\u00a0\u00a0\u00a0Essential Financial Accounting for S.S. by O.A. Longe Page 115 &#8211; 127<br \/>\n2.\u00a0\u00a0\u00a0\u00a0Business Accounting 1 by Frank Wood,  Page 82 &#8211; 93<br \/>\n3.\u00a0\u00a0\u00a0\u00a0Financial Accounting with Ease by Yomi Onafowokan,\u00a0\u00a0\u00a0\u00a0  Page 65 \u2013 73<\/p>\n<p>\u00a0<strong>GENERAL EVALUATION QUESTIONS<br \/>\n<\/strong>1        What is the difference between depreciation and amortization<br \/>\n2        Give two examples each of assets associated with depreciation and amortization<br \/>\n3        Differentiate between adjustments and closing entries<br \/>\n4        State seven benefits of keeping accounting records in a business<br \/>\n5        List five source documents used in preparing the cash book   <\/p>\n<p>\u00a0<strong>WEEKEND ASSIGNMENT<br \/>\n<\/strong>1.\u00a0\u00a0\u00a0\u00a0When fixed assets are sold, it is recorded in ________ (a) depreciation \u00a0\u00a0\u00a0\u00a0accounts (b) disposal account (c) sales account (d) deposits account<br \/>\n2.\u00a0\u00a0\u00a0\u00a0The following is a method of treating disposal of asset (a) good method \u00a0\u00a0\u00a0\u00a0(b) bad method (c) old method of depreciation (d) cash book method<br \/>\n3.\u00a0\u00a0\u00a0\u00a0In the old method, depreciation is ________ in the asset account.<br \/>\n\u00a0\u00a0\u00a0\u00a0(a) debited (b) credited (c) both debited and credited (d) all of the above<br \/>\n4.\u00a0\u00a0\u00a0\u00a0The double entry posting for profit on sale of fixed asset in the provision \u00a0\u00a0\u00a0\u00a0method affects the following accounts (a) asset account and provision for depreciation account (b) asset account and profit &amp; loss account (c) assets account and profit &amp; loss account (d) disposal account and profit &amp; loss account<br \/>\n5.\u00a0\u00a0\u00a0\u00a0Profit and loss account records profit on sale of asset on _________ side \u00a0\u00a0\u00a0\u00a0(a) debit (b) credit (c) left (d) right<\/p>\n<p>\u00a0<strong>THEORY<br \/>\n<\/strong>1.\u00a0\u00a0\u00a0\u00a0What is disposal of fixed assets?<br \/>\n2.\u00a0\u00a0\u00a0\u00a0What are the necessary entries needed to record profit on sale of asset ?<\/p>\n<p>\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"<p>\u00a0WEEK SIX AND SEVEN \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0DATE: ______________ TOPIC: DISPOSAL OF FIXED ASSETS CONTENT Meaning and definition&#8230;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1,252],"tags":[],"class_list":["post-3139","post","type-post","status-publish","format-standard","hentry","category-posts","category-second-term-ss2-financial-accounting"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/posts\/3139","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/comments?post=3139"}],"version-history":[{"count":1,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/posts\/3139\/revisions"}],"predecessor-version":[{"id":3140,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/posts\/3139\/revisions\/3140"}],"wp:attachment":[{"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/media?parent=3139"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/categories?post=3139"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/tags?post=3139"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}