1)

"Vaughn Manufacturingpurchased a new machine on May 1, Year 9 for $550800. At the time of acquisition, the machine was estimated to have a useful life of ten years and an estimated salvage value of $30000. The company has recorded monthly depreciation using the straight-line method. On March 1, Year 18, the machine was sold for $82200. What should be the loss recognized from the sale of the machine?"

$0.00

$8,560.00

$30,000.00

$38,560.00

2) Bonita Industriestraded machinery with a book value of $788400and a fair value of $730000. It received in exchange fromSandhill Co.a machine with a fair value of$789000.Bonitaalsopaid cash of $78900in the exchange.Sandhill s machine has a book value of $788400. What amount of gain or lossshouldBonitarecognizeon the exchange (assuming lack of commercial substance)?

$ -0-

$5840loss

$58400 loss

$78900 gain