Assignment 1 CLO1 Deyar Company incurred the following expenditures to acquire an equipment: Purchase price $55,000, delivery expenses $5,000, fixing and testing $3,000, transit insurance $1,000, annual maintenance $2,000, sales commissions $1,000, annual insurance expense $2,000, and operating fuel and lubricants $1,000. The equipment started operations on January 1, 2016. It has been depreciated using the straight-line method based on estimated salvage value of $5,000 and an estimated useful life of 6 years. Instructions 1. Determine the cost of the equipment. (1 marks) 2. Compute and record the depreciation expense. (1 marks) 3. Prepare Deyar Company's journal entries to record transactions under four independent situations: a. Retired the equipment at the end of the fourth year (Dec. 31, 2019). (2 marks) b. Sold the equipment for $38,000 cash on December 31, 2018. (2 marks) c. Sold the equipment for $25,000 Cash on July 1, 2019. (2 marks) d. On January 1, 2019, exchanged the old equipment, which had a fair value of $40,000 with a new equipment and paid $10,000 cash. (2 marks)