Jan 3 171,000 63,000 Equipment (New) Accumulated Depreciation - Equipment Equipment (Old) Cash Gain on Exchange of Equipment 130,000 100,000 4,000 Jun 30: Sold a building that had a cost of $635,000 and had accumulated depreciation of $170,000 through December 31 of the preceding year. Depreciation is computed on a straight-line basis. The building has a 40-year useful life and a residual value of $295,000. Blair received $135,000 cash and a $325,750 note receivable. Before we record the sale of the building, we must record the depreciation expense for the current year. Start by journalizing depreciation expense on the building through June 30. Journal Entry Date Accounts Debit Credit Jun 30