At the beginning of the year, Wong's 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 Hangar's books are also available. The carrying amounts, appraisal results, installation costs, and renovation expenditures follow: Carrying amount on Hangar's books Appraisal value Installation costs Renovation costs prior to Machine A Machine B Machine C $8,000 $29,000 $6,000 9,500 32,000 8,500 300 500 200 2,000 400 600 use 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. Machine A Machine B Machine C Cost of each machine 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 Double-declining- 2,000 balance 4 years View transaction list Journal entry worksheet 1 > Record depreciation expense. Note: Enter debits before credits. General Journal Debit Credit Transaction 1 Record entry Clear entry View general journal View transaction list Journal entry worksheet 1 Record depreciation expense. Note: Enter debits before credits. General Journal Debit Credit Transaction 1 No journal entry required Accumulated depreciation, Machine A Accumulated depre on, Machine B Record en Accumulated depreciation, Machine C View general journal View transaction list Journal entry worksheet 1 > Record depreciation expense. Note: Enter debits before credits. General Journal Debit Credit Transaction 1 Depreciation expense Dividends Inventory Notes payable Office equipment Record en View general journal