Disposal of PPE - 30 minutes - 11 marks On October 1, 2021, Stark Company decides to sell a piece of equipment they purchased on January 1, 2018 for $120,000. At the time of purchase, Stark estimated the equipment was going to have an estimated useful life of 5 years and an estimated residual value of $35,000. The company uses straight-line depreciation. The following table shows the balance of relevant accounts on December 31, 2020. Note that depreciation has NOT been recorded for 2021. Credit Debit $120,000 Equipment Accumulated Depreciation - Equipment $51,000 Required: 1. Prepare the journal entry to record the depreciation expense for 2021. 2. Prepare the journal entry to record the disposition on October 1, 2020 assuming the equipment was sold for $50,000 cash. 3. Prepare the journal entry to record the disposition on October 1, 2020 assuming the equipment was exchanged for $40,000 cash and a machine valued at $35,000 Space has been provided below to show your calculations