Morris Inc. recorded the following transactions over the life of a piece of equipment purchased in Year 1: Jan. Jan. 1, Year Purchased equipment for $14,300 cash. The equipment was estimated to have a five-year 1 life and $6,320 salvage value and was to be depreciated using the straight-line method. Dec. 31, Year Recorded depreciation expense for Year 1. 1 Sept. 30, Year Undertook routine repairs costing $731. 2 Dec. 31, Year Recorded depreciation expense for Year 2. 2 1, Year Made an adjustment costing $3,150 to the equipment. It improved the quality of the output 3 but did not affect the life and salvage value estimates. Dec. 31, Year Recorded depreciation expense for Year 3. 3 June. 1, Year Incurred $313 cost to oil and clean the equipment. 4 Dec. 31, Year Recorded depreciation expense for Year 4. 4 1, Year Had the equipment completely overhauled at a cost of $7,680. The overhaul was estimated 5 to extend the total life to seven years. The salvage value did not change. Dec. 31, Year Recorded depreciation expense for Year 5. 5 1, Year Received and accepted an offer of $15, 300 for the equipment. 6 Jan. Oct. Required a. Use a horizontal statements model to show the effects of these transactions on the elements of the financial statements. The first event is recorded as an example. b. Determine the amount of depreciation expense to be reported on the income statements for Years 1 through 5. c. Determine the book value (cost - accumulated depreciation) Morris will report on the balance sheets at the end of Year 1 through Year 5. d. Determine the amount of the gain or loss Morris will report on the disposal of the equipment on October 1, Year 6