PART IV(20 POINTS) An asset with a cost of $540,000, estimated life of 5 years, and residual value of $90,000, is depreciated by the straight-line method. This asset is sold for $380,000 at the end of the second year of use.

Required:

1. Compute accumulated depreciation at the end of the second year of use.

2. Compute gain or loss on the sale of the asset