Depreciation of Equipment Fiddle Company purchased equipment for $270,000. Fiddle expects to use the equipment for six years and to be able to sell it for $30,000 at the end of that period. If Fiddle uses straight-line depreciation:

a. Compute the amount to be reported as to depreciation expense each year, the accumulated depreciation at the end of each year, and the book value at the end of each year.

b. If Fiddle sells the equipment for $48,000 at the end of year five, will it report a gain or loss on the sale? What amount of gain or loss will be reported?