1. Brown Inc. disposed of an asset at the end of the sixth year of its estimated life for $19,000 cash. The asset's life was originally estimated to be 8 years. The original cost was $40,000 with an estimated residual value of $8,000. The asset was being depreciated using the straight-line method. What was the gain (or loss) on the disposal

Gain of 3,000

Loss of 9,000

Loss of 3,000

Gain of 9,000

2. ABC Corporation issues 4,000, 10-year, 8%, $1,000 bonds at 97 (97% of par value). The journal entry to record the issuance will show a

debit to Cash of $4,000,000.

debit to Discount on Bonds Payable for $120,000.

credit to Cash for $3,880,000

credit to Bonds Payable for $3,880,000.