ENTRY NO. 38 – DISPOSAL OF CAPITAL ASSETS - 10538

(New: 12/2021)

(New and renumbered from 8671, 8672, and 10521)

DISPOSITION – SALE

Purpose: To record the disposition of capital assets by sale for funds using the modified accrual basis of accounting.

References: SAM sections 8640-8643, and 8366.

General Ledger – Modified Accrual Basis

Debit/ Credit	Account	Legacy Account	Account Description	Note
Debit	1104000	1140	Cash in State Treasury	a
Credit	417xxxx	8000	Revenue	a
Credit	5xxxxxx	9000	Appropriation Expenditures	b

Subsidiary Capital Assets Group of Accounts Ledger

Debit/ Credit	Account	Legacy Account	Account Description	Note
Debit	3200000	5200	Investment in Capital Assets	c
Credit	16xxxxx	2xxx	Capital Assets	c

Note:

1. Record the sale of assets on a modified accrual basis of accounting within the fund as miscellaneous revenue. Agencies/departments using FI$Cal will record the sales proceeds in the Modified Accrual Ledger.
2. In the case of a trade-in of a capital asset, record any proceeds from the sale as miscellaneous revenue. An exception to this rule occurs when the receipts are used to replace the old asset with another asset. In this case, the receipts are abated to the appropriations from which the replacement items are budgeted. See SAM 8366
3. Record capital assets sold by those funds that use the modified accrual basis of accounting in the capital assets group of accounts. Agencies/departments using FI$Cal will record the capital asset disposal in the Departmental Adjustment Ledger.

 

DISPOSITION – TRANSFER OUT

Purpose: To record the disposition of capital assets transferred to other state agencies of funds using the modified accrual basis of accounting.

General Ledger – Modified Accrual Basis

Debit/ Credit	Account	Legacy Account	Account Description	Note
			No Entry	a

 

 

Subsidiary Capital Assets Group of Accounts Ledger

Debit/ Credit	Account	Legacy Account	Account Description	Note
Debit	3200000	5200	Investment in Capital Assets	b
Credit	16xxxxx	2xxx	Capital Assets	b

Note:

1. No entry is recorded in the general ledger if no cash is exchanged.
2. Record capital assets transferred to other state agencies by those funds that use the modified accrual basis of accounting in the capital assets group of accounts. Agencies/departments using FI$Cal will record the capital asset disposal in the Departmental Adjustment Ledger.

Record the transferred-out capital asset as a beginning balance adjustment on Report 18 and detail the transfer-out on the Differential Report. See SAM section 7977.