On January $2,2021,$ Indigo Hospital purchased a $$99,500$ special radiology scanner from Handley Inc. The scanner has

a useful life of five years and will have no disposal value at the end of its useful life. The straight$-$line method of

depreciation is used on this scanner. Annual operating costs with this scanner are $$104,600.$

Approximately one year later, the hospital is approached by lvanhoe Technology salesperson Laura Hall, who indicates

that purchasing the scanner in $2021$ from Handley was a mistake. She points out that Ivanhoe has a scanner that will

save Indigo Hospital $$25,500$ a year in operating expenses over its four$-$year useful life. She notes that the new scanner

will cost $$119,400$ and has the same capabilities as the scanner purchased last year. The hospital agrees that both

scanners are of equal quality. The new scanner will have no disposal value. Ivanhoe agrees to buy the old scanner from

Indigo Hospital for $$61,700.$

$($a$)$

Assume Indigo Hospital sells its old scanner on January $2,2022.$ Calculate the gain or loss on the sale.

If Indigo Hospital sells its old scanner it incurs a

of $

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