Rottino Company purchased a cutting machine for $17,000 on January 1, 2017 that was depreciated using the double-declining-balance method over 5 years with $0 salvage value. The machine was either (i) sold for $7,600 cash on October 31, 2018 or (ii) exchanged along with $1,000 cash for a new machine valued at $7,000 on that same date.

1. Rottino Company purchased a new cutting machine on January 1, 2017, at $17,000, paid in cash.
It has been depreciated using the double-declining-balance method based on an estimated
salvage value of $0 and an estimated useful life of 5 years. Prepare Rottino Company's journal
entries to record the disposal of the machine on October 31, 2018, in these two independent
situations (show your calculations to prove the result):
Requirement: (i) Sold the machine for $7.600 cash.
(ii) Exchange the old cutting machine with cash of $1,000 for a new cutting machine. The old
machine had a fair value of $7,000.