The Machine Was Originally Purchased on January 1,2017 for $40,000

question 139

Essay

The machine was originally purchased on January 1,2017 for $40,000.The machine was estimated to have a useful life of 5 years and no residual value.The company uses straight-line depreciation.On December 31,2018,the machine was sold for $25,000.
Required:
Part a.Determine the gain (loss)on disposal,if any.
Part b.Prepare the journal entry to record the sale.
Part c.Assuming that the company had used the double-declining balance method instead of the straight-line method,explain how this would this have affected the gain (or loss)on the sale.(Do not include any calculations. )

Define and explain key terms related to dividends and stock transactions, including ex-dividend date, date of record, and homemade dividends.

Understand the financial rationale behind stock repurchases and their effects on shareholders' wealth.

Assess the implications of changes in debt-equity ratio on dividend policy and capital structure.

Interpret the significance and process involving the declaration, payment, and effect on shareholders of regular cash dividends.

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Definitions:

Consistency

The quality of always acting or behaving in the same way, or the uniformity of a substance's texture.

Civil War

An armed conflict within a country, fought between factions or regions seeking control or autonomy.

Ironclad Ships

Warships from the 19th century, heavily armored with iron or steel plates, notable in naval warfare history.

Shallow Water

An area of water that is not deep, often near the shore or in a body of water where the depth is minimal.