When an asset is no longer usable, it is scrapped.

You can scrap an asset anytime using the "Scrap Asset Under Manage button" in the Asset record. You will be asked for confirmation, click on Yes and the asset will be scrapped.

The "Gain/Loss Account on Asset Disposal" account mentioned in the Company is debited by the Current Value (After Depreciation) of the asset.

A Journal Entry will be created if you scrap an asset

After scrapping, you can also restore the asset using "Restore Asset" button from the asset master.