During 2012, Ct Company disposed of three different assets. On January 1, 2012, prior to the disposal

During 2012, Côté Company disposed of three different assets. On January 1, 2012, prior to the disposal of the assets, the accounts reflected the following:

The machines were disposed of in the following ways:

a. Machine A: Sold on January 1, 2012, for \(\$ 8,200\) cash.

b. Machine B: Sold on April 1, 2012, for \(\$ 27,000\); received cash, \(\$ 23,000\), and a \(\$ 4,000\) interestbearing \((12 \%)\) note receivable due at the end of 12 months.

c. Machine C: Suffered irreparable damage from an accident on July 2, 2012. On July 10, 2012, a salvage company removed the machine immediately at no cost. The machine was insured, and \(\$ 18,000\) cash was collected from the insurance company.
\section*{Required:}
1. Prepare all journal entries related to the disposal of each machine in 2012.
2. Explain the accounting rationale for the way that you recorded each disposal.

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Original Residual Estimated Asset Cost Value Life Machine A $20,000 $3,000 8 years Machine B 42,600 4,000 20 years Accumulated Depreciation (straight line) $12,750 (5 years) 15,440 (8 years) Machine C 76.200 4,200 15 years 57,600 (12 years)