On date of sale:

Cash account Dr
Fixed Assets account Cr

On date of transfer of profit or loss to P&L account :
If loss :

Fixed asset account Dr
P&L account Cr

If profit:

P&L account Dr
Fixed asset account Cr.

While drawing the cash flow statement:

The cash flow will be categorised under Investing activity. If there is profit, the amount of profit will be deducted from Income from operations. If there is loss, the amount of loss will be added to Income from operations.

Is that clear.

By the way Mumtaz, how many years did it take Shah Jahan to built the Taj ?
Ramesh.
ramesh_prathivadhi@yahoo.co.in

gain on disposal of fixed assest.. since you gain the enrty would be like this:

debit-. cash or any consideration xxxx
credit- asset (book value) xxx
credit- gain on disposal xxx

for a concrete example, suppose your asset's book value is 500 and you sold it for 600 cash. you gained 100 from the transaction.

debit- cash 600
credit- asset 500
credit- gain on disposal of fixed asset 100