Mercury Incorporated purchased equipment in 2022 at a cost of $315,000. The equipment was expected to produce 570,000 units over the next five years and have a residual value of $30,000. The equipment was sold for $160,500 part way through 2024. Actual production in each year was: 2022 = 81,000 units 2023 = 129,000 units 2024 = 65,000 units. Mercury uses units-of-production depreciation, and all depreciation has been recorded through the disposal date.

1. Calculate the gain or loss on the sale.
2. Prepare the journal entry to record the sale.
3. Assuming that the equipment was instead sold for $197,500, calculate the gain or loss on the sale.
4. Prepare the journal entry to record the sale in requirement 3

Mercury Incorporated purchased equipment in 2022 at a cost of $315,000. The equipment was expected to produce 570,000 units over the next five years and have a residual value of $30,000. The equipment was sold for $160,500 part way through 2024 . Actual production in each year was: 2022=81,000 units; 2023=129,000 units; 2024=65,000 units. Mercury uses units-of-production depreciation, and all depreciation has been recorded through the disposal date. Required: 1. Calculate the gain or loss on the sale. 2. Prepare the journal entry to record the sale. 3. Assuming that the equipment was instead sold for $197,500, calculate the gain or loss on the sale. 4. Prepare the journal entry to record the sale in requirement 3. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Calculate the gain or loss on the sale. Note: Do not round intermediate calculations. Prepare the journal entry to record the sale. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Complete this question by entering your answers in the tabs below. Assuming that the equipment was instead sold for $197,500, calculate the gain or loss on the sale. Note: Do not round intermediate calculations. Prepare the journal entry to record the sale in requirement 3. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not roun intermediate calculations