Ashkar Company ordered a machine on January 1, 2013, at an invoice price of $21,000. On the date of delivery, January 2, 2013, the company paid $7,000 on the machine, with the balance on credit at 10 percent interest due in six months. On January 3, 2013, it paid $1,000 for freight on the machine. On January 5, Ashkar paid installation costs relating to the machine amounting to $2,400. On July 1, 2013, the company paid the balance due on the machine plus the interest. On December 31, 2013 (the end of the accounting period), Ashkar recorded depreciation on the machine using the straight-line method with an estimated useful life of 10 years and an estimated residual value of $3,100.

a. compute the acquisition cost of the machine

Acquisition Cost of the Machine
Acquisition cost	$0

b. Compute the depreciation expense to be reported for 2013

c. What would be the net book value of the machine at the end of 2014? (Amounts to be deducted should be indicated by a minus sign.)

Net book value at end of 2014	$0

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