A Machine with a Useful Life of 6 Years and a Residual

question 28

Essay

A machine with a useful life of 6 years and a residual value of $3,000 was purchased at the beginning of year 1 for $30,000.The machine was sold for $15,000 on April 1 in year 4.
(a)What was the book value of the machine at the end of year 3 assuming the straight-line method of depreciation is used?
(b)Illustrate the effects on the accounts and financial statements of the depreciation from January 1 to April 1 of year 4.
(c)Illustrate the effects on the accounts and financial statements of the sale of the machine on April 1.

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Definitions:

Harmless

Not causing or capable of causing injury or harm.

Panic Attack

A sudden onset of intense fear or discomfort, which may include physical symptoms such as palpitations, sweating, or trembling.

Heart Attack

A medical emergency caused by the blockage of blood flow to the heart muscle, often resulting in damage to or death of the heart muscle.

Manic Episode

A period of abnormally elevated or irritable mood, energy levels, and activity, often associated with bipolar disorder.