On Jan 2, JKM Co buys a $40,000 piece of equipment paying $15,000 down and signing a 4 year note for the remaining balance. On Jan 2, JKM Co paid $1,500 freight cost and $5,500 installation cost to get the equipment ready to be used. The useful life of the equipment is 10 years. The equipment has an estimated residual value of $7,000. JKM Co uses straight line depreciation. Required: 1. Prepare the journal entry or entries needed to record the equipment cost as of Jan 2. 2. Calculate the annual depreciation. Please use the space below the JE table on the MSWord link file to show your calculation of annual depreciation. 3. Prepare the journal entry as of Dec 31 to record depreciation. 4. JKM Co sold the piece of equipment on Dec 31 at the end of 8 years for $14,000 cash. Prepare the entry to record the sale of the equipment. Assume depreciation has been recorded through the sale date. Show your calculations for the disposal of the equipment below the JE table