E9-3 Determining Financial Statement Effects of an Asset Acquisition and Straight-Line Depreciation [LO 9-2, LO 9-3) O'Connor Company ordered a machine on January 1 at a purchase price of $15,000 On the date of delivery, January 2, the company paid $4,000 on the machine and signed a long term note payable for the balance On January 3, it paid $200 for freight on the machine. On January 5, O'Connor paid cash for installation costs relating to the machine amounting to $900 On December 3 (the end of the accounting period), O'Connor recorded depreciation on the machine using the straight line method with an estimated useful life of 10 years and an estimated residual value of $1600 Required: 1. indicate the effects (accounts, amounts, and+for increase - for decrease of each transaction on January 1 2 3 and 5 on the accounting equation 2. Compute the acquisition cost of the machine 3. Compute the depreciation expense to be reported for the first year 4. What should be the book value of the machine at the end of the second year? --- Required: Required 2 Required 3 Required 4 Indicate the effects (accounts, amounts, and + for increase. - for decrease) of each transaction (on January 1, 2, 3, and 5) on the accounting with a minus sign) Date Assets Liabilities Stockhold Jan 01 Jan 02 Equipment Notes Payablo (long-term) Cash JM03 Equipment fash Jun 05 (Cash Required 2 > 5 2. Compute the acquisition cost of the machine. 3. Compute the depreciation expense to be reported for the first year 4. What should be the book value of the machine at the end of the se 10 points Complete this question by entering your answers in the tabs be eBook Required 1 Required 2 Required 3 Required 4 Hint Compute the acquisition cost of the machine. Print References Acquisition Cost