Exercise 10-24 (Part Level Submission) On December 31, 2017, Swifty Inc. has a machine with a book value of $1,334,800. The original cost and related accumulated depreciation at this date are as follows. Machine Less: Accumulated depreciation Book value $1,846,000 511,200 $1,334,800 Depreciation is computed at $85,200 per year on a straight-line basis. Presented below is a set of independent situations. For each independent situation, indicate the journal entry to be made to record the transaction. Make sure that depreciation entries are made to update the book value of the machine prior to its disposal Your answer is correct. A fire completely destroys the machine on August 31, 2018. An insurance settlement of $610,600 was received for this casualty. Assume the settlement was received immediately (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit August 31, 2018 Depreciation Expense 56800 Accumulated Depreciation-Machinery 56800 To record current depreciation.) August 31, 2018 Cash 610600 Accumulated Depreciation-Machinery 568000 Loss on Disposal of Machinery 667400 Machinery 1846000 To record loss of the machine.) (b) Your answer is correct. On April 1, 2018, Swifty sold the machine for $1,476,800 to Dwight Yoakam Company. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit April 1, 2018 Depreciation Expense 21300 Accumulated Depreciation-Machinery 21300 (To record current depreciation.) April 1, 2018 Cash 1476800 Accumulated Depreciation-Machinery 532500 Machinery 1846000 Gain on Disposal of Machinery 163300 (To record sale of the machine.) (c) On July 31, 2018, the company donated this machine to the Mountain King City Council. The fair value of the machine at the time of the donation was estimated to be $1,562,000. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit July 31, 2018 To record current depreciation.) July 31, 2018 (To record donation of the machine.)