Question

Loss on disposal of assets is credited to _____________.

• A. Depreciation a/c
• B. Assets a/c
• C. Loss on sale of assets a/c
• D. Profit and loss a/c

Answer 1

Answer: (B)

Assets a/c

The disposal of assets involves eliminating assets from the accounting records. This is needed to completely remove all traces of an assets from the balance sheet. An asset disposal may require the recording of a gain or loss on the transaction in the reporting period when the disposal occurs. The journal entry recorded as Debit cash for the amount received , debit all accumulated depreciation, debit the loss on sale of asset account, and credit the fixed asset.