Slapshot Corporation recently decided to dispose of a significant portion of its plant assets. The assets to be held for disposal are summarized here:

$($Click the icon to view the assets to be held for disposal.$)$

$($Click the icon to view the changes in fair value.$)$

Requirement

Prepare any journal entries necessary to account for the changes in fair value for Years $1$ and $2.($Record debits first, then credits. Exclude explanations from any journal entries.$)$

Begin by recording the journal entry to reclassify the machinery held for sale.

Changes in fair value

Assets to be held for disposal

Machinery is depreciated by the straight$-$line method, assuming a $6-$year life

with no scrap value. The asset was acquired $3$ years ago.

${?}^{*****}$ Equipment is depreciated by the straight$-$line method, assuming a $10-$year life

with no scrap value. The asset was acquired $4$ years ago.