When a fixed asset is sold, scrapped, or traded, the carrying amount must be removed and any difference between proceeds and net book value is recognized as a gain or loss. This calculator supports disposal journal entry planning and P&L impact review.
How to use this calculator
- Enter the asset's original capitalized cost.
- Enter accumulated depreciation to date.
- Enter sale proceeds (cash or fair value of consideration).
- Review net book value, gain or loss, and financial statement impacts.
Formula
Net book value = Original cost − Accumulated depreciation. Gain = Proceeds − Book value (if positive). Loss = Book value − Proceeds (if positive).
Example
Equipment costing $50,000 with $35,000 accumulated depreciation has $15,000 book value. Sold for $20,000 → $5,000 gain on disposal.
Frequently asked questions
What if accumulated depreciation exceeds cost?
Fully depreciated assets may have zero book value. This calculator requires accumulated depreciation ≤ original cost — review asset records if totals differ.
Where is gain or loss presented?
Presentation varies by entity policy — often other income/expense or a dedicated gain/loss on asset disposal line. Consult your chart of accounts.
Does this include sales tax or disposal fees?
Enter net proceeds after disposal costs if they reduce cash received. Capitalized disposal obligations may require separate analysis.
How does this relate to depreciation schedules?
Accumulated depreciation should reconcile to your depreciation schedule through the disposal date. Use the Depreciation Schedule Calculator to project book value beforehand.