City Taxi Service purchased a new auto to use as a taxi on January 1. Year 1, for $20,600. In addition, City paid sales tax and title fees of $1,430 for the vehicle. The taxi is expected to have a five-year life and a salvage value of $6,100. Required a. Using the straight-line method, compute the depreciation expense for Year 1 and Year 2. (Round your onswers to the nearest whole dollar omount) b. Assume the auto was sold on January 1, Year 3, for $18,007. Determine the amount of gain or loss that would be recognized on the asset disposal. (Round the intermediate calculations to nearest whole dollar amount.)