Question

Required information [The following information applies to the questions displayed below.) Onslow Co. purchases a used machine for $144,000 cash on January 2 and readies it for use the next day at a $10,000 cost. On January 3, it is installed on a required operating platform costing $2,000, 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. 3. Prepare journal entries to record the machine's disposal under each of the following separate assumptions: 1. Record the sale of the used machine for $21,500 cash. 2. Record the sale of the used machine for $86,000 cash. 3. Record the insurance settlement received of $32,000 resulting from the total destruction of the machine in a fire.
I need to know how to get all of the answers with the red x

Answer 1

Answer:

3.

Date	Particulars	Debit ($)	Credit ($)
1	Cash	21500
	Accumulated depreciation - Machinary (23120*5)	115600
	Loss on sale of machinary (154000-21500-115600)	16900
	Machinary((144000+10000))		154000
	(To record sale of machine)
2	Cash	86000
	Accumulated depreciaion (23120*5)	115600
	Gain on sale of machinary (86000+115600-154000)		47600
	Machinary		154000
	(To record sale of machine)
3	Cash	32000
	Accumulated depreciation - Machinery	115600
	Loss from fire (154000-32000-115600)	6400
	Machinery		154000
	(To record cash insurance settlement)

Working notes:

Depreciation expense - Machinery = ((machine value - salvage value)/useful life)
=((144000+10000+2000-17280)/6 years)
=23120