On January 1, 2012, Smith Air purchased an airplane for $67,850,000. Smith Air expects the plane to remain useful for 11 years and to have a residual value of $2,950,000. Smith Air uses the straight-line method to depreciate its airplanes. Smith Air flew the plane for 5 years and sold it on January 1, 2017, for $8,000,000.
1. Compute accumulated depreciation on the airplane at January 1, 2017 (same as December 31, 2016).
2. Record the sale of the plane on January 1, 2017.