Assume that Gonzalez Company purchased an equipment on January 1, 2014, for $60,000. The equipment had an estimated life of six years and an estimated residual value of $6,000. The company used the straight-line method to depreciate the equipment. On July 1, 2016, the equipment was sold for $40,000 Chart of Accounts ASSETS REVENUE Required: 1. Make the journal entry to record depreciation on the equipment through July 1, 2016. Record the sale of the asser on wy 1, 2016. 2. How should the gain or loss on the sale of the asser be presented on the income statement? 111 Cash 411 Sales Reverie 121 Accounts Receivable 491 Gain on Sale of Asset 141 Inventory 152 Prepaid Insurance EXPENSES 54 Supplies General Journal 14 Equipment 17 Accumulated Depreciation 500 Cost of Goods Sold 521 Salaries and Wages Ex 532 Utlities Expense 533 Insurance Expense Make the journal entry with the impact on the financial statements to record depreciation on the equipment through July 1, 2016. Record the sale of the asset on wy 1, 2016. LIABILITIES 534 Rent Expense General lowmastructions 11 Accounts Payable 537 Suppiles Expense 541 Depreciation Expense 551 Advertising Expense 559 Miscellaneous Expense GENERAL JOURNAL 31 Salaries and Wages Payable 25 Notes Payable PAGE 1 $1 Income Taxes Payable IMPACT ON FINANCIAL STATEMENTS BALANCE SHEET INCOME STATEMENT EQUITY LIABILITIES EQUITY REVENUE EXPENSES NET INCOME 1 Capital Stock 1 Retained Earnings 810 Interest Expense 910 Income Tax Expense DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT ASSETS 1 2 Final Question 3 + 5 2. How should the gain or loss an the sale of the asset be presented on the income statement? The gain or loss should appear in the of the income statement to indicate that it part of the normal operating activity a the company