P8-5 Recording and Interpreting the Disposal of Three Long-Lived Assets Recording and Interpreting the Disposal of Three Long-Lived Assets (AP8-5) During the current year, Yost Company disposed of three different assets. On January 1 of the current year, prior to the disposal of the assets, the accounts reflected the following: P8-5 LO8-3,8-5 Accumulated Asset Original Cost Residual Value Estimated Depreciation Life (straight line) Machine A $ 21,000 Machine B Machine C 120,000 85,000 $ 3,000 14,000 5,000 8 years $15,750 (7 years) 10 years 84,800 (8 years) 15 years 64,000 (12 years) The machines were disposed of during the current year in the following ways: a. Machine A: Sold on January 1 for $5,000 cash. b. Machine B: Sold on December 31 for $30,500; received cash, $22,500, and an $8,000 interest-bearing (12 percent) note receivable due at the end of 12 months. c. Machine C: On January 1, this machine suffered irreparable damage from an accident. On January 10, a salvage company removed the machine at no cost. Required: 1. Give all journal entries related to the disposal of each machine in the current year. 2. Explain the accounting rationale for the way that you recorded each disposal