(Click icon for company costs.) (Click icon for more information.) Required Invoice cost of item Freight cost (allocated equally) Testing costs (allocated equally) Total Requirement b. Date Account Dec 31, 2013 uses straight-line depreciation. Calculate the amount of depreciation expense for the year ended December 31, 2013, relating to the m Debit Credit Requirement c. Prepare the journal entry (entries) for the exchange of the mixing machines on January 1, 2015. State any assumptions required. The exchange involves primarily consideration with substance so the is used. Required b. c. d. Calculate the amounts to be included PPC's property, plant, and equipment. Use separate asset categories where appropriate. PPC uses straight-line depreciation. Calculate the amount of depreciation expense for the year ended December 31, 2013, relating to the mixing machine, and prepare the related journal entry. Prepare the journal entry (entries) for the exchange of the mixing machines on January 1, 2015. State any assumptions required. What would be the journal entry (entries) for the exchange of mixing machines if your assumptions in part (c) were not valid? Print Done Company costs - X ar. Leave any cells blank if no entry is needed.) Date Transaction Amount Mixing machine Packaging machine Freight for machine delivery Feb. 1, 2013 Mar. 1, 2013 500 square metre addition to factory Cost of testing new assembly line $ 20,000 36,000 8,000 120,000 15,000 Although the testing costs were previously incurred, they arguably considered as part of the costs. The new freight cost must be Prepare the journal entry based upon the assumptions above. (Round your calculation(s) to the nearest whole dollar. Leave any cells blank if no entry is needed.) Credit Date Jan 1, 2015 Account Debit Jan. 1, 2013 Print Done More info The mixing machine and the packaging machine are about the same size, weight, and complexity. On March 31, 2013, testing ended and the new assembly line went into full production and shipments to customers began immediately. The company intends to produce sauces for the next 20 years, at which time the assembly line is expected to be completely obsolete with no salvage value. On January 1, 2015, PPC realized that its mixing machine was too small due to its very successful entry into the sauce business. The company exchanged its mixing machine for a newer, higher-capacity machine that had a fair value of $25,000. The original manufacturer accepted the old machine plus $1,000 for the exchange. PPC incurred $3,600 to ship the old and new machines to their respective destinations. No additional testing was needed for the new machine because of its similarity to the old machine; otherwise, it would have cost $8,000 to test the new machine. Print Done Requirement d. What would be the journal entry (entries) for the exchange of mixing machines if your assumptions in part (c) were not valid? The exchange involves primarily consideration with substance so the cannot be used. PPC should use the book value of the asset given up to value the exchange, resulting in Although the testing costs were previously incurred, they arguably considered as part of the costs. The new freight cost must be Prepare the journal entry based upon the assumptions above. (Round your calculation(s) to the nearest whole dollar. Leave any cells blank if no entry Credit Date Jan 1, 2015 Account Debit needed.)