The property, plant, and equipment section of the Jasper Company's December 31, 2010, balance sheet contained the following:
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The land and building were purchased at the beginning of 2006. Straight-line depreciation is used and a residual value of $40,000 for the building is anticipated.
The equipment is comprised of the following three machines:
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The straight-line method is used to determine depreciation on the equipment. On March 31, 2011, Machine 102 was sold for $52,500. Early in 2011, the useful life of machine 101 was revised to seven years in total, and the residual value was revised to zero.
Required:
1. Calculate the accumulated depreciation on the equipment at December 31, 2010.
2. Prepare the journal entry to record the sale of machine 102. Also prepare the journal entry to record 2011 depreciation on machine 102 up to the date of sale.
3. Prepare the 2011 year-end adjusting journal entries to record depreciation on the building and equipment.