Hertzog Company Purchased and Installed a Machine on February 1,2019,at

question 47

Essay

Hertzog Company purchased and installed a machine on February 1,2019,at a total cost of $72,000.Straight-line depreciation was calculated based on the assumption of a five-year life and no residual value.The machine was disposed of on July 31,2022.Assuming the machine was totally destroyed in a fire and the insurance company settled the claim for $18,000 cash,prepare the general journal entry to record the disposal.

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Definitions:

Total Fixed Cost

The sum of all expenses that remain constant regardless of the level of production or sales activities, such as rent, salaries, and insurance premiums.

Driver's Side Air Bag

A safety feature located in the steering wheel designed to protect the driver in the event of a collision.

Automobile Manufacturer

A company that produces and sells cars, trucks, and other vehicles, often focusing on both the design and assembly of automobile parts and complete vehicles.

Variable Cost

Expenditures that change in line with production or sales quantities, notably labor and materials.