7A. Brown's Salvage Company purchased equipment for $14,000. Brown recorded total depreciation of $10,000 on the equipment. Assume that Brown exchanged the old equipment for new equipment, paying $3,500 cash. The fair market value of the new equipment is $6,400. Joumalize Brown's exchange of equipment. Assume this exchange has commercial substance. Let's begin by calculating the gain or loss on the exchange of equipment. (Enter a loss with a minus sign or parentheses.) Market value of assets received Less: Book value of asset exchanged Cash paid Gain or (Loss) Journalize Brown's exchange of equipment. (Record a single compound journal entry. Record debits first, then credits. Select the explanation on the last line of the journal entry table.)