Rayya Co. purchases and installs a machine on January 1, 2015, at a total cost of $193,200. Straight-line depreciation is taken each year for four years assuming a seven-year life and no salvage value. The machine is disposed of on July 1, 2019, during its fifth year of service. 1. Prepare entries to record the partial year’s depreciation on July 1, 2019. Record the depreciation expense as of July 1, 2019. 2. Prepare entries to record the disposal under the following separate assumptions: The machine is sold for $82,800 cash. Record the sale of machinery. 3. Rayya receives an insurance settlement of $66,240 resulting from the total destruction of the machine in a fire. Record the insurance settlement received of $66,240 resulting from the total destruction of the machine in a fire.
Rayya Co. purchases and installs a machine on January 1, 2015, at a total cost of $193,200. Straight-line
1. Prepare entries to record the partial year’s depreciation on July 1, 2019.
Record the depreciation expense as of July 1, 2019.
2. Prepare entries to record the disposal under the following separate assumptions: The machine is sold for $82,800 cash.
Record the sale of machinery.
3. Rayya receives an insurance settlement of $66,240 resulting from the total destruction of the machine in a fire.
Record the insurance settlement received of $66,240 resulting from the total destruction of the machine in a fire.
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