Recording the Disposal of an Asset at Three Different Sale Prices

FedEx is the world's largest express transportation company. In addition to the world's largest fleet of all-cargo aircraft, the company has more than 650 aircraft and 58,000 vehicles and trailers that pick up and deliver packages. Assume that FedEx sold a delivery truck that had been used in the business for three years. The records of the company reflected the following: Delivery truck cost $35,000 Accumulated Depreciation 23,000 Required: 1. Give the journal entry for the disposal of the truck, assuming that the truck sold for a. $12,000 cash b. $12,400 cash c. $11,500 cash 2. Based on the three preceding situations, explain the effects of the disposal of an asset.