Question
On January 1, 2011, a company purchased a machine for $138,000. In addition, the company paid delivery costs of $1,200 and $4,800 to have the
On January 1, 2011, a company purchased a machine for $138,000. In addition, the company paid delivery costs of $1,200 and $4,800 to have the machine installed. At the end of 5 years, the company expects to sell the machine for $11,500. The company uses the double-declining-balance method of depreciation. If the company sells the machine at the end of 5 years and receives $11,000, the journal entry to record the sale will include which of the following?
A) Credit to Machine for $138,000.
B) Debit to Loss on Sale for $500.
C) Credit to Residual Value for $12,000.
D) Debit to Accumulated Depreciation for $138,000.
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