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II. PROBLEM QUESTIONS A. On January 1, 2016, Farmer Inc. purchased five machines at a...

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II. PROBLEM QUESTIONS A. On January 1, 2016, Farmer Inc. purchased five machines at a cost of $14,000 each. The company adopted the group (straight-line) depreciation method, using an eight-year life with a $2,800 salvage value per machine. Correct depreciation was recorded in 2016 and 2017. On January 1, 2018, one of the machines was sold for S6,500. On January 3, 2018, a new unrelated piece of equipment was purchased for $15,000 with no salvage value and a six-year life. It will be depreciated using the straight-line method. Required: Prepare appropriate journal entries for a. January 1, 2018 b. December 31, 2018, to record depreciation expense ANS a. b

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