DIRECTIONS For PA9-2: For each transaction, first determine the gain or loss: Get Give Gain or Loss For transaction 1, the get is cash For transaction 2, the get is zero, as no cash is received Part 1 is the same as Scenario a from the in-class exercise for chapter 9; there will be 2 debits and 2 credits Part 2 is like scenario b, except there is not a debit to cash; there will be 2 debits and 1 credit

HELP CALULCATE THE PROBLEM AND REPORT THE EFFECTS.

NOTE: THIS IS ALL ONE QUESTION NOT SEPERATE.

During the current year, Martinez Company disposed of two different assets. On January 1, prior to their disposal, the accounts reflected he following: Asset Original Cost Residual Value Estimated Life Accumulated Depreciation (straight-line) Machine A $76,200 $4,200 15 years $62,400 (13 years) Machine B 20,000 2,000 8 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 scrapped with zero proceeds (and zero cost of removal). Required: 1. Give the journal entry related to the disposal of Machine A on January 2 of the current year. 2. Give the journal entry related to the disposal of Machine B on 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