Mondale Winery depreciates its equipment using the group method. The cost of equipment purchased in 2016 totaled $425,000. The estimated residual value of the equipment was $40,000 and the group depreciation rate was determined to be 18%. What is the annual depreciation for the group?

If equipment that cost $42,000 is sold in 2017 for $35,000, what amount of gain or loss will the company recognize for the sale?