Mon. Royw Co purchased equipment on January 1, 2017 for $3,000,000 and paid cash for 62.000.000 and issued to your note payable for the rest. Mon Royal Cooped $20.000 cash to shipping and installation of the equipment Other information . Estomated use of the equipment at the time of purchase, 10 years Estimated salvage residual value at the time of purchase $320.000 The company uses the straight line method of depreciation The company's fiscal year coincides with the calendar year On January 1, 2019 the equipment needed a major repair, The company paid $400,000 to report the equipment Based on an expert opinion, the rear will increase the use of the equipment for two years, however the residual value remains the same . On July 1 2020 the company sold the equipment for 52.000.000 cash The journal entry prepared by Mon-Royal Co. to record the acquisition of equipment on January 1, 2017 is O a. Dr. Equipment $3,020,000; Cr. Cash $2,020,000, Cr. Note payable $1,000,000 Ob. Dr. Equipment $3,000,000; Cr. Cash $2,000,000, Cr. Note payable $1,000,000 Oc. Dr. Equipment $3,000,000, installation expense $20,000; Cr. Cash $2,020,000. Cr. Note payable $1,000,000 Od Dr. Stock $3,020,000; Cr. Cash $2,020,000, Cr. Note payable $1,000,000 What would be the amount of depreciation expense based on straight line method for the year 2017 and 2018 O a. 600,000 for year 2017 and 700,000 for year 2018, Ob. 270,000 for year 2017 and 270,000 for year 2018. O c. 540,000 for year 2017 and 560,000 for year 2018 Od. 650,000 for year 2017 and 650,000 for year 2018, The journal entry prepared by Mon-Royal Co. to record the depreciation expense for year 2018 is O a. Dr. Depreciation expense 270,000; Cr. Equipment 270,000 b. Dr. Depreciation expense 560,000; Cr. Equipment 560,000 Oc. Dr. Depreciation expense 270,000; Cr. Accumulated Depreciation 270,000 Od Dr. Depreciation expense 560,000: Cr. Accumulated Depreciation 560,000