At the beginning of the year, Grillo Industries bought three used machines from Freeman Incorporated. The machines immediately were overhauled, were installed, and started operating. Because the machines were different, each was recorded separately in the accounts.

At the beginning of the year, Grillo Industries bought three used machines from Freeman Incorporated. The machines Immediately were overhauled, were installed, and started operating. Because the machines were different, each was recorded separately in the accounts. Machine A Machine B Machine C Cost of the asset $9, 200 $38, 400 $22 , 200 Installation costs 900 2,300 1, 400 Renovation costs prior to use 700 1, 900 2, 400 Repairs after production began 700 800 900 By the end of the first year, each machine had been operating 8,000 hours. Required: 1. Compute the cost of each machine. 2. Prepare the journal entry to record depreciation expense at the end of year 1, assuming the following: Estimates Machine Life Residual Value Depreciation Method 5 years $1, 200 Straight-line 20,000 hours 1, 600 Units-of-production 10 years 1, 600 Double-declining-balance