CH CP9-2 Recording and Interpreting the Disposal of Long-Lived Assets [LO 9-5) During the current year, Martinez Company disposed of two different assets. On January 1, prior to their disposal, the accounts reflected the following: Asset Machine A Machine B Original Cost $76,200 20,000 Residual Value $4,200 2,000 Estimated Life 15 years 8 years Accumulated Depreciation (straight-line) $62,400 (13 years) 13,500 (6 years) The machines were disposed of in the following ways: a. Machine A: Sold on January 2 for $20,000 cash. b. Machine B: On January 2, this machine was sold to a salvage company at zero proceeds (and zero cost of removal). Required: 1. & 2. Prepare the journal entries related to the disposal of Machine A and B on the January 2 of the current year. TIP: When no cash is received on disposal, the loss on disposal will equal the book value of the asset at the time of disposal. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) Journal entry worksheet Machine A: Sold on January 2 for $20,000 cash. Record the transaction. Note: Enter debits before credits. Date General Journal Jan 02 Debit Cash Credit 20,000 Record entry Clear entry View general Journal View transaction list Journal entry worksheet Machine B: On January 2 this machine suffered irreparable damage from an accident and was removed immediately by a salvage company at no cost. Record the transaction. Note: Enter debits before credits. Date General Journal Debit Credit Jan 02 Record entry Clear entry View general journal