On March 31, 2013, the Herzog Company purchased a factory complete with machinery and equipment. The allocation of the total purchase price of $1,000,000 to the various types of assets along with estimated useful lives and residual values are as follows:

Asset	Cost			Estimated Residual Value			Estimated Useful Life in Years
Land	$	100,000		N/A			N/A
Building		500,000		none			25
Machinery		240,000		10% of cost			8
Equipment		160,000		$	13,000		6
Total	$	1,000,000

On June 29, 2014, machinery included in the March 31, 2013, purchase that cost $100,000 was sold for $80,000. Herzog uses the straight-line depreciation method for buildings and machinery and the sum-of-the-years'-digits method for equipment. Partial-year depreciation is calculated based on the number of months an asset is in service.

Required:

1.

Compute depreciation expense on the building, machinery, and equipment for 2013.

2.	Prepare the journal entries to: a) record the depreciation on the machinery sold on June 29, 2014 b) and the sale of machinery.