Journal Entries for Non-current Assets (Cambridge International AS Accounting)
Exam board Cambridge International · ASUpdated 2026-02-10
Spec point — how to measure the value of non-current assets by the cost model or the revaluation model how to prepare ledger accounts and journal entries for: – non-current assets (acquisition and revaluation) – depreciation and disposal (including entries for part exchange)
Journal entries for non-current assets
What are the journal entries for the acquisition of a non-current asset?
- The table below shows the journal entries to record the purchase of a non-current asset
| Account to debit | Account to credit | |
|---|---|---|
| A non-current asset is purchased using cash or money in the bank | Non-current asset | Cash/bank |
| A non-current asset is purchased using credit or loan | Non-current asset | Other payables account such as bank loan |
| A non-current asset is introduced to the business by the owner | Non-current asset | Capital |
What are the journal entries for the depreciation of a non-current asset?
-
The table below shows the journal entries to record the depreciation of a non-current asset
-
The entries are determined by whether the cost model or the revaluation model is used
- The cost model always keeps the original cost of the non-current in a separate account
- The revaluation model allows the cost of the non-current asset to change
| Account to debit | Account to credit | |
|---|---|---|
| The depreciation charge at the end of the year using the cost model (straight-line or reducing balance method) | Statement of profit or loss | Provision for depreciation |
| The depreciation charge at the end of the year using the revaluation model | Statement of profit or loss | Non-current account |
Exam Hint Remember, no entries are made in the non-current account for depreciation when using the straight-line or reducing balance method.
What are the journal entries for the sale or disposal of a non-current asset?
- The table below shows the journal entries to record the sale or disposal of a non-current asset
| Account to debit | Account to credit | |
|---|---|---|
| Remove the original cost of the non-current asset | Disposal | Non-current account |
| Remove the accumulated depreciation of the non-current asset | Provision for depreciation | Disposal |
| Record the sale proceeds | Bank/cash/other receivables account | Disposal |
| Transfer to the statement of profit or loss (if a profit is made) | Disposal | Statement of profit or loss |
| Transfer to the statement of profit or loss (if a profit is made) | Statement of profit or loss | Disposal |
What are the journal entries for the part exchange of a non-current asset?
- The table below shows the journal entries to record the part exchange of a non-current asset
| Account to debit | Account to credit | |
|---|---|---|
| Remove the original cost of the old non-current asset | Disposal | Non-current account |
| Remove the accumulated depreciation of the non-current asset | Provision for depreciation | Disposal |
| Record the allowance for the part exchange | Non-current account | Disposal |
| Transfer to the statement of profit or loss (if a profit is made) | Disposal | Statement of profit or loss |
| Transfer to the statement of profit or loss (if a profit is made) | Statement of profit or loss | Disposal |
| Record the payment of the remaining balance of the new non-current asset | Non-current asset | Cash/bank/other payables account |
Was this revision note helpful?