On January 1, 2010, Mulligan Co At the End of the Second Year, Machine B Was

question 85

Multiple Choice

On January 1, 2010, Mulligan Co.began using the composite depreciation method.There were three machines to consider, as follows: $\begin{array}{lrrl}&&\text { Residual }\\\text { Assset } &\text { Cost }&\text { Value} &\text { Life }\\\text { A } & \$ 20,000 & \$ 2,000 & 6 \text { years } \\\text { B } & 15,000 & 3,000 & 3 \text { year } \\\text { C } & 5,000 & 1,000 & 4 \text { year }\end{array}$ At the end of the second year, Machine B was sold for $8, 200.In the entry to record the sale, there should be a

• A)$1, 200 debit to Gain on Sale of Machine
• B)$6, 800 debit to Accumulated Depreciation
• C)$6, 800 debit to Loss on Sale of Machine
• D)$8, 000 debit to Accumulated Depreciation

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Definitions:

Champagne glass distribution

Refers to the visual representation of income distribution, where most wealth is concentrated at the top, resembling the shape of a champagne glass.

Total world income

The aggregate of all the earnings generated by individuals, businesses, and governments across the entire world within a specific period.

G8 and G20 countries

Groups of major advanced and emerging economies, respectively, that discuss and cooperate on international financial and economic issues.

Developing country

A nation with a less developed industrial base and a lower Human Development Index relative to other countries.