Book value of machine at sale
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On January 1, Year 1, Jayco purchased a machine for $6,000. It had an estimated salvage value of $1,200 and a life of six years. The straight-line method of depreciation was used. At, midyear in Year 4, Jayco sold the machine for $4,500 cash.
Required:
a. What is the book value of the machine at the time of the sale?
b. Give the journal entry to record the sale of the machine.
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Solution Summary
The solution explains how to determine the book value of machine at sale and prepare the related journal entries
Solution Preview
a. Depreciation per year = (Cost-Salvage Value)/Useful Life
Depreciation per year = (6,000-1,200)/6 = 800.
Since ...
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