The following data relate to the Machinery account of Eshkol, Inc. at December 31, 2025.

*In the year an asset is purchased, Eshkol, Inc. does not record any depreciation expense on the asset. In the year an asset is retired or traded in, Eshkol, Inc. takes a full year’s depreciation on the asset.

The following transactions occurred during 2026.

a. On May 5, Machine A was sold for $13,000 cash. The company’s bookkeeper recorded this retirement in the following manner in the cash receipts journal.

b. On December 31, it was determined that Machine B had been used 2,100 hours during 2026.

c. On December 31, before computing depreciation expense on Machine C, the management of Eshkol, Inc. decided the useful life remaining from January 1, 2026, was 10 years.

d. On December 31, it was discovered that a machine purchased in 2025 had been expensed completely in that year. This machine cost $28,000 and has a useful life of 10 years and no salvage value. Management has decided to use the double-declining-balance method for this machine, which can be referred to as “Machine E.”

Instructions

Prepare the necessary correcting entries for the year 2026. Record the appropriate depreciation expense on the above-mentioned machines. No entry is necessary for Machine D.

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Original cost Year purchased Useful life Salvage value Depreciation method Accum. depr. through 2025* A $46,000 2020 10 years $ 3,100 Sum-of-the- years'-digits $31,200 B $51,000 2021 Machinery 15,000 hours $ 3,000 Activity $35,200 C $80,000 2022 15 years $ 5,000 Straight-line $15,000 D $80,000 2024 10 years $ 5,000 Double-declining- balance $16,000