Blue Manufacturers Inc., a publicly listed company, has two machines that are accounted for under the revaluation model. Technology in Blue's industry is fast-changing, causing the fair value of each machine to change significantly approxima tely every two years. The following information is available:

Prepare the journal entries required for 2017, using the asset adjustment method.

Machine # 1 Machine # 2 Acquisition date Jan . 2 , 2014 June 30 , 2013 Original cost $464,000 $588, 000 Original estimate of useful life 8 years 12 years Original estimate of residual value Pattern of depreciation Straight - line Straight - line Fair value at Dec . 31 , 2015 328.000 478 500 Balance in Machinery account after proportionate method revaluation on Dec . 31 2015 437 , 333 504 , 420 Balance in Accumulated Depreciation account after proportionate method revaluation on Dec . 31 , 2015 109 . 333 125 920 Cumulative balance in ( Revaluation Gain or Loss Revaluation Surplus ( OCT ) at Jan . 1 , 2017 (20 000) 13.000 Fair Value at Dec . 31 , 2017 242000 300 000