iaz Company owns a milling machine that cost $125,400 and has accumulated depreciation of $93,000. Prepare...

iaz Company owns a milling machine that cost $125,400 and has accumulated depreciation of $93,000. Prepare the entry to record the disposal of the milling machine on January 3 under each of the following independent situations.

The machine needed extensive repairs, and it was not worth repairing. Diaz disposed of the machine, receiving nothing in return.
Diaz sold the machine for $17,300 cash.
Diaz sold the machine for $32,400 cash.
Diaz sold the machine for $40,400 cash

Solutions

Expert Solution

Journal entry for situation 1: The machine needed extensive repairs, and it was not worth repairing. Diaz disposed of the machine, receiving nothing in return -

Accounts	Dr	Cr
Accumulated depreciation - Milling machine	93,000.00
Loss on disposal of milling machine	32,400.00
Milling machine		125,400.00

Journal entry for situation 2: Diaz sold the machine for $17,300 cash -

Accounts	Dr	Cr
Cash	17,300.00
Accumulated depreciation - Milling machine	93,000.00
Loss on disposal of milling machine	15,100.00
Milling machine		125,400.00

Journal entry for situation 3: Diaz sold the machine for $32,400 cash -

Accounts	Dr	Cr
Cash	32,400.00
Accumulated depreciation - Milling machine	93,000.00
Milling machine		125,400.00

Journal entry for situation 4 - Diaz sold the machine for $40,400 cash -

Accounts	Dr	Cr
Cash	40,400.00
Accumulated depreciation - Milling machine	93,000.00
Gain on sale of milling machine		8,000.00
Milling machine		125,400.00

ekkarill92 answered 3 months ago

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