On January 2, 2013, Bering Co. disposes of a machine costing $ 44,000 with accumulated depreciation of $ 24,625. Prepare the entries to record the disposal under each of the following separate assumptions.
1. The machine is sold for $ 18,250 cash.
2. The machine is traded in for a newer machine having a $ 60,200 cash price. A $ 25,000 trade in allowance is received, and the balance is paid in cash. Assume the asset exchange lacks commercial substance.
3. The machine is traded in for a newer machine having a $ 60,200 cash price. A $ 15,000 trade in allowance is received, and the balance is paid in cash. Assume the asset exchange has commercial substance.