I have an asset that I purchased using the Spend Money function from a Bank Account for $500 on 11/25/2013. I recorded depreciation against this asset by clicking Accumulated Depreciation >> New Depreciation Entry for $250 on 12/15/2013 and $250 on 12/15/2014. Now that the Purchase Cost and total Accumulated Depreciation values are equal ($500) I need to dispose of the asset (scrapped). I clicked the Edit button on the asset I am intending to dispose of and checked Disposed fixed asset, then enter the date of disposal as 12/16/2014.
The Book Value now says “Disposed on 12/16/2014”.
I expected the book value on the Balance Sheet (in Fixed Assets and Fixed assets, accumulated depreciation) to reduce to zero, but it still shows $500 and ($500) respectively. I confirmed this using Balance Sheet reports dated 12/16/2014, 12/31/2014 and 6/7/2015 (but only uploaded an image from 12/31/2014 due to new user picture upload limitation).
I actually have a similar problem with an Intangible Asset that has a larger number of Accumulated Amortization entries, but since the Intangible Asset function is new I wanted to confirm it using a simplified example in Fixed Assets before I posted my question.
Can you please advise why the Balance Sheet has not reduced the Fixed Assets and Fixed assets, accumulated depreciation entries to zero and how I can resolve this issue?