Accounting Entries for Assets: 1.

Fully Depreciated Asset with No Gain/Loss:

Debit: Accumulated Depreciation (to remove the accumulated
depreciation on the asset)
1. ASSET PURCHASE
ASSET CLEARING A/C-DR Debit: Loss on Disposal (if any, for any incidental costs or residual
TO AP ACCRUAL A/C value adjustments)
Credit: Asset (to remove the cost of the asset from the books)
2. CIP - PURCHASE
CIP CLEARING A/C-DR 2. Fully Depreciated Asset with a Gain on Disposal:
TO AP LIABILITY A/C Debit: Accumulated Depreciation Debit: Loss on Disposal (if
any)
3. CIP - ADD Debit: Cash/Bank (for the cash received from the sale)
CIP COST A/C-DR Credit: Asset Cost
TO CIP CLEARING A/C Credit: Gain on Disposal (to record the gain on the
disposal)
4 CAPTIALIZE CIP
ASSET COST A/C-DR 3. Partially Depreciated Asset:
TO CIP COST A/C Debit: Accumulated Depreciation (to remove the accumulated
depreciation on the asset)
5. Depreciation Expense: Debit: Loss on Disposal (if any)
Depreciation A/c Dr.
Debit: Cash/Bank (for the cash received from the sale)
Depreciation Adjustment A/c …Dr
Credit: Asset (to remove the cost of the asset from the books)
To Accumulative Depreciation
Credit: Gain on Disposal (to record the gain on the disposal)
6. ASSET RETIRED
ACCUMULATED DEP A/C-DR 4. Asset Donated or Scrapped:
PROCEED OF SALES A/C-DR Debit: Accumulated Depreciation (to remove the accumulated
TO ASSET COST A/C depreciation on the asset)
TO DEPRECIATION A/C Debit: Loss on Disposal (if any)
Credit: Asset (to remove the cost of the asset from the
7. ASSET REMOVAL books)
ACCUMULATED DEP A/C-DR
PROCEED OF SALES A/C-DR
TO ASSET COST A/C 5. Asset Sold on Credit:
TO DEPRECIATION A/C Debit: Accounts Receivable (for the amount receivable from
TO COST REMOVAL A/C the buyer)
Credit: Asset
8. TRANSFER Credit: Gain on Disposal (if any)
ASSET COST A/C-DR
DEPRECIATION A/C-DR
TO ACCUMULATED DEPRECIATION A/C
====================================

RETIREMENT AND SALE OF THE AN ASSET:

Accumulated Depreciation …Dr.

Proceeds of sales Clearing A/c …Dr.
Cost of Removable Gain A/c …Dr.
Revaluation Reserve A./c …Dr
Net Book Value Retired Gain …Dr.
To Asset Cost A/c
To Proceeds of Sale Gain A/c
To Cost of Removable Gain A/c
To Revaluation Reserve Retired Gain