Problem 8-6A Disposal of plant assets LO C1, P1, P2

[The following information applies to the questions displayed below.]

Onslow Co. purchased a used machine for $144,000 cash on January 2. On January 3, Onslow paid $6,000 to wire electricity to the machine and an additional $1,200 to secure it in place. The machine will be used for six years and have a $17,280 salvage value. Straight-line depreciation is used. On December 31, at the end of its fifth year in operations, it is disposed of.

Problem 8-6A Part 1

Required:

1.Prepare journal entries to record the machine's purchase and the costs to ready it for use. Cash is paid for all costs incurred.

Problem 8-6A Part 2

2.Prepare journal entries to record depreciation of the machine at December 31.

Problem 8-6A Part 3

3.Prepare journal entries to record the machine's disposal under each separate situation: (a) it is sold for $24,000 cash; (b) it is sold for $96,000 cash; and (c) it is destroyed in a fire and the insurance company pays $34,500 cash to settle the loss claim.

Problem 86A Part 1 Required: 1. Prepare journal entries to record the machine's purchase and the costs to ready it for use; Cash is paid for all costs incurred. 9 Answer Is not complete. Depreeielien expenseMachinery Accumulated dapreciaunMael'lhery Journal entry worksheet A 2 3 Record the costs of $6,000 incurred on the used machine. Note: Enter debits before credits. Date General Journal Debit Credit Jan 03 Depreciation expense-Machinery Accumulated depreciation-MachineryJournal entry worksheet Record the cost of $1,20 for an operating platform. Note: Enter debits before credits. Problem 8-6A Disposal of plant assets LO C1, P1, P2 [The following information applies to the questions displayed below.] Onslow Co. purchased a used machine for $144,000 cash on January 2. On January 3, Onslow paid $6,000 to wire electricity to the machine and an additional $1,200 to secure it in place. The machine will be used for six years and have a $17,280 salvage value. Straight-line depreciation is used. On December 31, at the end of its fifth year in operations, it is disposed of. Problem 8-6A Part 2 2. Prepare journal entries to record depreciation of the machine at December 31. x Answer is complete but not entirely correct. No Date General Journal Debit Credit 1 Dec 31 Depreciation expense-Machinery V 22,320 Accumulated depreciation-Machinery V 22,320 2 Dec 31 Machinery X 151,200 X Accumulated depreciation-Machinery 111,600 X Loss on sale of machinery X 39,600 XJournal entry worksheet A 2 Record the year of disposal year-end adjusting entry for the depreciation expense of the used machine. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Machinery 151,200 Accumulated depreciation-Machinery 111,600 Loss on sale of machinery 39,600