Gift Of Asset By Company To Employee Journal Entry
When the company or employer gives An Asset to an employee as a gift , then there is no proceeds i.e., cash is not received. In this journal entry, the asset is credited with original cost or historical cost and accumulated depreciation is debited upto the full use of assets during the accounting period. The difference is the Non Operating Expense / Income. Example: ABC company gives a laptop of $5000, purchased on 1st January, 2022 with useful life of 10 years with no residual value, to an employee, Mr. A. The laptop gifted to employee on 1st January, 2024. The Method of Depreciation is straight- line method with rate of depreciation is 10%. Record the journal entry in the book of ABC company for the laptop gifted to Mr. A on 1st January, 2024. Given: Cost of Laptop = $5000 Useful Life = 10 Years Depreciation Method = Straight-Line Rate of Depreciation = 10% Calculation: Straight-Line Depreciation = Cost of Laptop - Residual Value / Useful Life = $5000 - 0...