Wang Industries purchased a machine for $280,000 cash on the first day of Year 1. In addition to the purchase price, Wang spent an additional $17,500 cash for shipping and installation. The company originally estimated that the machine had a useful life of 10 years and a residual value of $26,250.

On the last day of Year 4, Wang sold the machine to another company for $105,000 cash.

Record the following transactions on the financial statement effects template: a. Acquisition of the machine b. Depreciation in the first year. Wang uses the straight-line method of depreciation. c. Sale of the machine on the last day of Year 4. (Assume that Wang was using the equipment up to the sale date.)

Note: Use negative signs with your answers, when appropriate. Select "N/A" as your answer if a part of the accounting equation is not affected.

	Balance Sheet				Income Statement
	Cash		Noncash		Contra				Contributed		Earned								Net
Transaction	Asset	+	Assets	-	Assets	=	Liabilities	+	Capital	+	Capital				Revenue	-	Expenses	=	Income
Purchased machine	Answer		Answer				Answer				Answer						Answer		Answer
	AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A		AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A				AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A				AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A						AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A
Depreciation in Year 1	Answer		Answer		Answer						Answer						Answer		Answer
	AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A		AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A		AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A						AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A						AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A
Sale of machine in Year 4	Answer		Answer		Answer		Answer				Answer				Answer		Answer		Answer
	AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A		AnswerAccum. DepnAccounts payableAccounts receivableCashDepreciation expenseGain on saleLoss on saleMachineryRetained earningsSales revenueEquipment expenseN/A		Answer