The Savage Corporation purchased three milling machines on January 1, 2013 and immediately placed them in service. The following information relates to these purchases:

The company uses the straight-line method of depreciation, and records ½ year depreciation in the years of acquisition and disposal. On January 1, 2018, machine 1 was sold for $500. On the same day, management re-evaluated the estimated useful lives and the residual values of the remaining machines. They came to the conclusion that machine 2 had a remaining useful life of two years (that is, to December 31, 2019), while residual value remained unchanged. Machine 3 had a remaining useful life of five years (that is, to December 31, 2022) but now no residual value.
Required: Prepare journal entries
1. To record the sale of machine 1 on January 1, 2018.
2. To record the revised 2018 depreciation expense for machine 2.
3. To record the revised 2018 depreciation expense for machine 3.

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Machine 1 $7,500 Cost Residual value Useful life Machine 2 $7,500 1,200 6 Years Machine 3 $7,500 300 8 Years 5 Years