Year	Cost	Accumulated depreciation	BV	Depreciation
1995	100,000	-	100,000	20,000
1996	100,000	20,000	80,000	16,000
1997	100,000	36,000	64,000	12,800
1998	100,000	48,800	51,200	10,240
1999	100,000	59,040	40,960	8,192
2000	100,000	67,232	32,768	6,554
2001	100,000	73,786	26,214	5,243
2002	100,000	79,028	20,972	4,194
2003	100,000	83,223	16,777	3,355
2004	100,000	86,578	13,422	2,684
2005	100,000	89,263	10,737	2,147

In this question,the net book value(NBV)of the machine after10years of estimated life=10,737.

Given in the question the residual value of the machine is supposedly to be$1,000.

Do we account for the difference between the NBV and RV?i.e:10,737-1,000=9,737

So the journal entry would be

Dr Cash700

Dr Accumulated Depreciation99,000

Dr Loss on disposal300

Cr Equipment100,000

If we do not account for the difference,how will the journal entry be like?I can't balance the accounting equation.

**** so we just depreciate the machinery $90000