Accounting entry on Sale of Asset

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Accepted Answer

The accounting entry on the sale of an asset involves recording the proceeds from the sale and removing the asset from the balance sheet.

Debit the Cash or Accounts Receivable account for the amount received from the sale
Credit the Asset account for the original cost of the asset
Credit the Accumulated Depreciation account for the accumulated depreciation on the asset
Any gain or loss on the sale should be recorded separately
Example: If a company sells a vehicle for $10,000 that was originally purchased for $15,000 and had accumulated depreciation of $5,000, the accounting entry would be: Debit Cash $10,000, Credit Vehicle $15,000, Credit Accumulated Depreciation $5,000, and Credit Gain on Sale of Vehicle $1,000 (if there is a gain).

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