Saturn Co. purchases a used machine for $144,000 cash on January
2 and readies it for use the next day at an $8,000 cost. On January
3, it is installed on a required operating platform costing $1,600,
and it is further readied for operations. The company predicts the
machine will be used for six years and have a $17,280 salvage
value. Depreciation is to be charged on a straight line basis. On
December 31, at the end of its fifth year in operations, it is
disposed of.
1.)
Prepare journal entries to record
the machine’s purchase and the costs to ready and install it. Cash
is paid for all costs incurred
2.)
Prepare journal entries to record
depreciation of the machine at December 31.
3.)
Prepare journal entries to record
the machineAfA?A??cAf?cAc€A!A?¬Af?cAc€A3A??cs disposal under each of the
following separate assumptions