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On January 1, Year 1, a company purchased equipment. The details of the equipment purchase are below. Question Title (1) \begin{tabular}{lr|} \hline Original Cost & $115,000 \\ Estimated Residual Value & $25,000 \\ Estimated Useful Life & 6 \\ Years in use until sold & 3 \\ \hline & $75,000 \\ \hline Requirement 2: Sale amount & $65,000 \\ Requirement 3: Sale amount & $0 \\ \hline Requirement 4: Retired & \\ \hline \end{tabular} IE 07-02 (Static) Using Excel to Calculate the Gain or Loss on Disposal of Depreciable Assets [LO 7-6] Required: 1. Based on the information above, calculate Depreciation Expense, Accumulated Depreciation and Book Value of the equipment Legend using the Straight-Line method for years 1-3. Check Answers 2. Assume that the equipment is sold at the end of year 3 for the sale amount in cell B9. (a) Calculate the Gain or Loss on sale. (b) Prepare the journal entry to record sale of the asset. Graded cell: Leave blank if no answer is 3. Assume that the equipment is sold at the end of year 3 for the sale amount in cell B10. Scratchpad: Use as a non-graded (a) Calculate the Gain or Loss on sale. workspace (b) Prepare the journal entry to record sale of the asset. 4. Assume that the equipment is retired at the end of year 3 (zero proceeds, given in cell B11). (a) Calculate the Gain or Loss on retirement. (b) Prepare the journal entry to record retirement of the asset. Requirement 1: Straight-Line Method (Use cells A2 to B11 from the given information above to complete this question.) Requirement 2: Assume Equipment is Sold for Amount in Cell B9 (a) Calculate Gain or Loss on Sale: (Use cells A2 to B11 from the given information above to complete this question. Accumulated depreciation should be presented as a positive amount. Hint: In cell A43, input a conditional IF statement to return the word "Gain" if cell C43 is a positive amount or "Loss" if cell C43 is a negative amount.) (Use cells A2 to B11 from the given information above to complete this question. Hint: A "gain" or "loss" account will auto-populate based on your answer in part (a). Show all values as positive amounts.) Requirement 3: Assume Equipment is Sold for Amount in Cell B10 (a) Calculate Gain or Loss on Sale: (Use cells A2 to B11 from the given information above to complete this question. Accumulated depreciation should be presented as a positive amount. Hint: In cell A65, input a conditional IF statement to return the word "Gain" if cell C65 is a positive amount or "Loss" if cell C65 is a negative amount.) (b) Journal Entry for Sale: (Use cells A2 to B11 from the given information above to complete this question. Hint: A "gain" or "loss" account will auto-populate based on your answer in part (a). Show all values as positive amounts.) Requirement 4: Assume Equipment is Retired (zero proceeds, given in Cell B11) (a) Calculate Gain or Loss on Retirement: (Use cells A2 to B11 from the given information above to complete this question. Accumulated depreciation should be presented as a positive amount. Hint: In cell A86, input a conditional IF statement to return the word "Gain" if cell C86 is a positive amount or "Loss" if cell C86 is a negative amount.) (b) Journal Entry for Retirement: (Use cells A2 to B11 from the given information above to complete this question. Hint: A "gain" or "loss" account will auto-populate based on your answer in part (a). Show all values as positive amounts.)