Lyons Ltd purchases a machine for $525,000 cash on 1 July 2006. The machine is to be depreciated on a straight-line basis over 5 years with an estimated residual value at the end of that time of $25,000.

Net selling price Value in use Market value$

30 June 2007 455,000 490,000 480,000 30 June 2008 270,000 310,000 295,000 30 June 2009 190,000 180,000 205,000

Required Prepare all journal entries related to the machine that are required on 30 June 2007, 2008 and 2009. Lyons Ltd uses the cost model to record and report its non-current assets. Narrations are not required. (Assume no changes to the estimated useful life and residual value of the machine. Round all calculations to the nearest dollar.)