Cullumber Company manufactures routers used in industrial modems. On May 15, 2017, Cullumber purchased a precision welding machine at a retail price of $98,400. Cullumber paid 5% sales tax on this purchase and hired a contractor to build a clean platform enclosure for the machine for $7,350. Cullumber estimates the machine will have a 5-year useful life, with a salvage value of $8,200 at the end of 5 years. Cullumber uses straight-line depreciation and employs the half-year convention in accounting for partial-year depreciation. Cullumbers fiscal year ends on December 31.

PART 1 (already completed)

At what amount should Cullumber record the acquisition cost of the machine?

ANSWER) Acquisition cost of the machine: $110,670

PART 2 (already completed)

How much depreciation expense should Cullumber record in 2017 and in 2018?

Depreciation expense 2017: $10,247

Depreciation expense 2018: $20,494

PART 3 (already completed)

At what amount will the machine be reported in Cullumbers balance sheet at December 31, 2018?

Amount to be reported in balance sheet: $79,929

PART 4 (THIS IS THE PART I NEED HELP WITH. PLEASE EXPLAIN AND SHOW ALL WORK SO I UNDERSTAND WHAT YOU DID THANK YOU)

During 2019, Cullumbers circuit board business is experiencing significant competition from companies with more advanced low-heat circuit boards. As a result, at June 30, 2019, Cullumber conducts an impairment evaluation of the welding machine purchased in 2017. Cullumber determines that undiscounted future cash flows for the machine are estimated to be $61,200 and the fair value of the machine, based on prices in the re-sale market, to be $53,000.

-> Prepare the journal entry to record an impairment, if any, on the welding machine. (If no entry is required, select "No Entry")