On January 1, 20X1, ABC Company purchased a machine for use in its factory. ABC started using the machine on February 1, 20X1. During 20X1, ABC spent the following on the machine and on expenditures related to the machine:

Description	Amount
Purchase price including sales tax	$107,000
Shipment cost to ABC's factory	1,000
Cost to build a platform in the factory to support the weight of the machine, incurred prior to installation	20,000
Cost to hire expert to calibrate machine prior to the first use - necessary in order to ensure machine works properly	5,000
Cost to replace fan belts and service machine after 9 months of use - required every 9 months to ensure machine operates as intended	2,000

1. Calculate the value in the machine asset account on February 1, 20X1.

2. Assume that ABC uses the units of production method of depreciation and the machine has a book value of $83,000 on December 31, 20X3. On January 1, 20X4, ABC sells the machine for $80,000 cash and purchases a newer higher capacity machine. Calculate the accounting gain or loss on the sale. Enter a loss in brackets.

3. Consider the impact of the sale in #2 on the 20X4 statement of cash flows:

a. In what section of the 20X4 Statement of Cash Flow does the sale appear?

b. What is the amount of cash inflow or outflow shown in the section identified in 3a on the 20X4 Statement of Cash Flows (inflow is positive, outflow is negative in brackets)?