Account for disposal of an asset. (LO 5)

Troy Wilson Athletic Gear purchased a packaging machine 4 years ago for \(\$ 18,000\). The machinery was expected to have a salvage value of \(\$ 2,000\) after an 8 -year useful life. Assuming straight-line depreciation is used, calculate the gain or loss realized if after 4 years the machinery was sold for:

a. \(\$ 11,400\)

b. \(\$ 7,800\)