On July 1, 2019, Osceola Company retired a metal stamping machine that it had originally purchased for $1,500,000. At December 31, 2018, the machine had a book value of $125,000 and was being depreciated on a straight-line basis at $75,000 per year. Osceola sold the machine for $200,000.

Required:
1. Prepare any journal entries necessary to record the disposal of the machine.
2. Next Level How does the disposal of the machine affect the 2019 financial statements?