At the beginning of the year, Wongs Martial Arts Centre bought three used fitness machines from Hangar Inc. for a total cash price of $38,000. Transportation costs on the machines were $2,000. The machines were immediately overhauled and installed, and started operating. The machines were different; therefore, each had to be recorded separately in the accounts. An appraiser was requested to estimate their market value at the date of purchase (prior to the overhaul and installation). The carrying amounts shown on Hangars books are also available. The carrying amounts, appraisal results, installation costs, and renovation expenditures follow:

	Machine A				Machine B				Machine C
Carrying amount on Hangars books	$	8,000			$	29,000			$	6,000
Appraisal value		9,500				32,000				8,500
Installation costs		300				500				200
Renovation costs prior to use		2,000				400				600

By the end of the first year, each machine had been operating 8,000 hours.

Required:
1.	Compute the cost of each machine by making a supportable allocation of the total cost to the three machines.

2.	Prepare the entry to record depreciation expense at the end of year 1, assuming the following: (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

	Estimates
Machine	Life		Residual Value				Depreciation Method
A	5	years		$	1,500		Straight-line
B	40,000	hours			900		Units-of-production
C	4	years			2,000		Double-declining-balance