Required information P8-6 (Algo) Recording and Interpreting the Disposal of Three Long-Lived Assets LO8-3, 8-5 Skip to question [The following information applies to the questions displayed below.] During the current year, Merkley 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: Asset Original Cost Residual Value Estimated Life Accumulated Depreciation (straight line) Machine A $ 30,000 $ 3,000 12 years $ 22,500 (10 years) Machine B 69,000 4,000 10 years 52,000 (8 years) Machine C 75,400 6,500 18 years 45,933 (12 years) The machines were disposed of during the current year in the following ways: a. Machine A: Sold on January 1 for $7,100 cash. b. Machine B: Sold on December 31 for $11,200; received cash, $2,500, and a $8,700 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.