Exercise 8-11A (Algo) Events related to the acquisition, use, and disposal of a tangible plant asset: Straight-line depreciation LO 8-2, 8-5 City Taxi Service purchased a new auto to use as a laxi on January 1. Year 1, for $26,200. In addition, Cilly paid sales lax and 111 . fees of $590 for the vehicle. The laxi is expecled to have a five-year life and a salvage value of $5,460. Required: a. Using the siraight-line method, compute the depreciallon expense for Year 1 and Year 2. Note: Round your answers to the nearest whole dollar amount. b. Assume the aulo was sold on January 1, Year 3, for $20,997. Determine the amount of gain or loss that would be recognized on the assel disposal Note: Round the intermediate calculations to nearest whole dollar amount