On January $1,$ Year $1,$ Raven Limo Service, Incorporated paid $$84,000$ cash to purchase a limousine$.$ The limo was expected to have a five$-$year useful life and a $$15,500$ salvage value. On January $1,$ Year $5$ the limo was sold for $$16,500$ cash. Assuming Raven uses straight$-$line depreciation, the company would recognize a:

Multiple Choice

$$12,700$ gain.

$$31,000$ gain.

$$12,700$ loss.

$$31,000$ loss.