Owner contributes a private machine to the business during the year

Transaction

In the middle of the year, the owner of a sole proprietorship transfers to the business a machine that she has owned privately for five years. An independent appraisal values it at $9,500.00 today. The business will use the machine in its workshop.

Assumptions: The machine is recorded at its fair value (the appraised value) on the day of the transfer. No sales tax applies.