During 2003, Kosik Company disposed of three different assets. On January 1 , 2003, prior to their disposal, the accounts reflected the following:

The machines were disposed of in the following ways:

a. Machine A: Sold on January 1, 2003, for $5,750 cash.

b. Machine B: Sold on December 3 1 , 2003, for $9,000; received cash, $4,000, and a $5,000 interestbearing (10%) note receivable due at the end of 12 months.

c. Machine C: On January 1 , 2003, this machine suffered irreparable damage from an accident.
Required: 1. Give all journal entries related to the disposal of each machine. 2. Explain the accounting rationale for the way that you recorded each disposal.

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Original Asset Cost Residual Value Estimated Accumulated Depreciation Life (straight line) Machine A $24,000 $2,000 years $17,600 (4 years) Machine B 16,500 5,000 10 years 8,050 (7 years) Machine C 59,200 3.200 14 years 48,000 (12 years)