$(16$ points$)$ Rogers Co$.$ had a sheet metal cutter that cost $$120,000$ on January $5,2010.$ This old cutter had an estimated life of ten years and a salvage value of $$20,000.$ On April $3,2015,$ the old cutter is exchanged for a new cutter with a fair value of $$60,000.$ The exchange lacked commercial substance. Rogers also received $$15,000$ cash. Assume that the last fiscal period ended on December $31,2014,$ and that straight$-$line depreciation is used.

Instructions

$($a$)$ Show the calculation of the amount of the gain or loss to be recognized by Rogers $Co.$

$($b$)$ Prepare all entries that are necessary on April $3,2015.$