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asset disposals - Prepare the journal entry recording the scrapping of the speaker?

Lozz entertainment provides disk jockey services for weddings and other events. At a recent gathering, one of Lozz's recently purchased speakers that began to smoke and was deemed unuseable. Lozz decided to scrap the speaker. The original cost of the speaker was $500 and lozz had recognized $100 of depreciation on it at the time of scrapping. Prepare the journal entry recording the scrapping of the speaker.... This is what I came up with but the answer is wrong... I need someone to please explain what I did wrong... Debit: Accum Deprec $400 Debit: Loss on Disposal of fixed assets $100 Credit: Equipment $500 HELP

Public Comments

1. The Accum Deprec balance was 100, not 400. An asset that cost 500, with A/D of 100, means it had a net book value of 400. Loss was 400.