DISPOSAL OF FIXED ASSETS

FINANCIAL ACCOUNTING SSS2 SECOND TERM              

WEEK 6 &7

DISPOSAL OF FIXED ASSETS

Contents

MEANING AND DEFINITION OF DISPOSAL OF FIXED ASSETS.

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 for the sale of fixed assets are shown below.

METHOD OF DISPOSAL OF FIXED ASSET

There are two methods of recording the disposal of fixed assets. They are the old and new methods of depreciation, on the asset sold

New method

Where depreciation has been…