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  3. during the current year, martinez company disposed

During the current year, Martinez Company disposed of two different assets. On January 1, prior...

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Accounting

During the current year, Martinez Company disposed of two different assets. On January 1, prior to their disposal, the accounts reflected the following:

Asset Original Cost Residual Value Estimated Life Accumulated Depreciation (straight-line)
Machine A $ 83,200 $ 8,400 15 years $ 64,827 (13 years)
Machine B 27,000 3,400 8 years 17,700 (6 years)

The machines were disposed of in the following ways:

  1. Machine A: Sold on January 2 for $27,000 cash.
  2. Machine B: On January 2, this machine was sold to a salvage company at zero proceeds (and zero cost of removal).

Required:

  1. 1. & 2. Prepare the journal entries related to the disposal of Machine A and B on the January 2 of the current year. TIP: When no cash is received on disposal, the loss on disposal will equal the book value of the asset at the time of disposal. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

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