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1. Tellesa Consulting Co. The Tellesa Consulting Co purchased a piece of machinery on July 31, 2021 for $150,000. It cost $2,700 to install and
1. Tellesa Consulting Co. The Tellesa Consulting Co purchased a piece of machinery on July 31, 2021 for $150,000. It cost $2,700 to install and test the machinery. Freight costs paid by Tellesa to get the machinery shipped to their factory were $900. At this time it is estimated that the machine would be used for 5 years and would have a residual value of $10,000 at that time. On July 2, 2025, the machine broke down and rather than repair it, Tellesa decided to sell it for $15,000. a) Prepare the journal entry to record the purchase of the machine on July 31, 2021. b) Calculate the amortization that would appear on the 2021 and 2022 Income Statement for Tellesa. Assume the straight line method for amortization. c) Record the journal entry for 2021 amortization. d) Prepare a partial balance sheet for Telles, just showing the machine and its amortization as at December 31, 2023. Assume the straight line method is used. e) Prepare the journal entry for the July 2, 2025 transaction
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