On December 31, 2017, Sheffield Inc has a machine with a book value of $1,015,200 The original cost and related accumulated depreciation at this date are as follows Machine $1,404,000 Less Accumulated depreciation 388,800 Book value $1,015,200 Depreciation is computed at $64,800 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 A fire completely destroys the machine on August 31, 2018 An insurance settlement of $464,400 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 Credit August 31, 2018 (To record current depreciation ) August 31, 2018 (To record loss of the machine ) SHOW LIST OF ACCOUNTS LINK TO TEXT On April 1, 2018, Sheffield sold the machine for $1,123,200 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 (To record current depreciation ) April 1, 2018 (To record sale of the machine ) SHOW LIST OF ACCOUNTS LINK TO TEXT 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 $1,188,000 (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 )

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 19, 2024

On December 31, 2017, Sheffield Inc. has a machine with a book value of $1,015,200. The original cost and related accumulated depreciation at this date

On December 31, 2017, Sheffield Inc. has a machine with a book value of $1,015,200. The original cost and related accumulated depreciation at this date are as follows.

Machine		$1,404,000
Less: Accumulated depreciation		388,800
Book value		$1,015,200

Depreciation is computed at $64,800 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.

A fire completely destroys the machine on August 31, 2018. An insurance settlement of $464,400 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	Credit
August 31, 2018

	(To record current depreciation.)
August 31, 2018



	(To record loss of the machine.)

SHOW LIST OF ACCOUNTS
LINK TO TEXT

On April 1, 2018, Sheffield sold the machine for $1,123,200 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

	(To record current depreciation.)
April 1, 2018



	(To record sale of the machine.)

SHOW LIST OF ACCOUNTS
LINK TO TEXT

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 $1,188,000. (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.)