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October 16, 2018
Solved

How do I show that I have sold a fixed asset?

  • October 16, 2018
  • 2 replies
  • 0 views

The asset that we sold has already been fully depreciated. 

Best answer by KH40_2

You will need to remove the asset and the accumulated depreciation from your books with a journal entry: you would debit the accumulated depreciation, credit the asset that was sold, debit the cash account (I am assuming you received cash) and finally credit you gain on sale of asset - this should be an other income account type. Since your book balance is at zero if fully depreciated the cash received would be a gain.

2 replies

KH40_2Answer
October 16, 2018

You will need to remove the asset and the accumulated depreciation from your books with a journal entry: you would debit the accumulated depreciation, credit the asset that was sold, debit the cash account (I am assuming you received cash) and finally credit you gain on sale of asset - this should be an other income account type. Since your book balance is at zero if fully depreciated the cash received would be a gain.

October 16, 2018
What if it's not fully depreciated and we sold it on an installment sale? In other words, what if we got a down-payment upon sale, and then received monthly payments?
November 15, 2018

The cash received line would be reduced to the down payment and you would need to create an Accounts Receivable entry for the balance of the sale price outstanding.

August 26, 2021

Hi,

We traded a truck for the purchase of a newer truck. The dealer paid the balance off  on the note we owed.

Do I just reverse the asset, reverse the depreciation and record the loss/gain?