On December 31, 2008, Lane, Inc. sold equipment to Noll and simultaneously leased it back for 12 years. Pertinent information at this date is as follows:

Required:
1. At December 31, 2008, should Lane report a gain from the sale of the equipment?
2. If not, how should it account for the sale and leaseback?

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Sales price Carrying amount Estimated remaining economic life $480,000 $360,000 15 years