Net Book Value Journal Entry

Profit on disposal proceeds net book value profit on disposal 4 500 3 000 1 500 the fixed assets disposal journal entry would be as follow.

Net book value journal entry. 5 200 000 goodwill on the books of the reporting unit 1 000 000 ignoring goodwill the fair market value of the reporting units net assets exceeds cost by 200 000. Disposal of an asset with zero book value and salvage value. If you believe there is an impairment record that impairment in a journal entry.

After one month the net book value of the table equals 3 780 45 3 735. Journal entries for revaluations. Journal entry to record the revaluation loss will be.

At any point in time we can determine the remaining value of the table its net book value by netting fixed assets and accumulated depreciation. Company a gives an old truck 1 000 000 cost 750 000 accumulated depreciation for a boat. 5 000 per month 600 000 120 months multiplied by the 12 months the asset was in use during 2016 5 000 12 months.

From the tables at 10 the factors for year 2 and 3 are 0 8264 and 0 7513 and the net present value is calculated as npv 5 000 3 000 x 0 8264 7 000 x 0 7513 npv 5 000 2 479 20 5 259 10 npv 2 738 30. Because this amount is less than the net book value of the old truck a loss is recorded for the difference. Cash of 4 500 is received for the asset and the business makes a gain on disposal of 1 500.

Net book value 540 000 in this example the accumulated depreciation was calculated by determining the depreciation amount per month and multiplying it by the number of months the asset was in use as of 12 31 2016. With accumulated depreciation of 10 000 and net book value of 160 000 it means the revalued amount in asset s account is 170 000. When the amount in the accumulated depreciation account reaches 3 780 the full value of our table has been recognized as depreciation expense on the income.

The software license was valid for four years. Since the asset had a net book value of 3 000 the profit on disposal is calculated as follows. In year 5 quarter 4 at the end of the asset s life you retire the asset with no proceeds of sale or cost of removal.