Straight-line Depreciation Terrace Corporation purchased used bulldozers and other earth-moving equipment with an expected useful life of five years for $1,200,000. Terrace expects to be able to sell the equipment for $250,000 at the end of five years. Assuming Terrace uses straight-line de- preciation:

a. What amount of depreciation expense will be reported each year?

b. What amount will be reported as accumulated depreciation at the end of each year?

c. What amount will be reported as the book value of the earth-moving equipment at the end of each year?

'

d. What amount of gain or loss will be reported by Terrace Corporation if the equipment is sold for $293,000 at the end of the fifth year?