At acquis E for Year I, what would you recommend to management? Would your recom Year 2? Why or why not? 2 Evaluate each method in terms of its effect on cash flow, fixed asset turno ing that Ford Motor Company is most interested in reducing taxes and maint Recording and Interpreting the Disposal of Three Long-Lived Assets (AP8-5 During the current year g the current year, Merkley Company disposed of three different assets. On J prior to the disposal of the assets, the accounts reflected the following: January 1 of the P8-6 8-3, 8-5 -3, 8-5 During tn disposa year Accumulated Original Residual Estimated Depreciation (straight line Life Asset Cost Machine A $21,000 Machine B 50,000 Machine C 85,000 $3000 10 years 4,000 5.000 15 years 8 years $15,750 (7 years) 36.800 (8 years) 64,000 (12 years) The machines were disposed of during the current year in the following ways: a. Machine A: Sold on January 1 for $5,000 cash. b. Machine B: Sold on December 31 for $10.500; received cash, $2.500, and an $8,000 int interest-bearig (12 percent) note receivable due at the end of 12 months. c. Machine C: On January I, this machine suffered irreparable damage from an accident. On January11 a salvage company removed the machine at no cost. Required: 1. Give all journal entries related to the disposal of each machine in the current year 2. Explain the accounting rationale for the way that you recorded each disposal