Sale of Equipment

Equipment was acquired at the beginning of the year at a cost of $34,500. The equipment was depreciated using the double-declining-balance method based on an estimated useful life of five years and an estimated residual value of $670.

a.What was the depreciation for the first year?

$ _______________

b.Assuming the equipment was sold at the end of year 3 for $7,970, determine the gain or loss on the sale of the equipment.

$ _______________

Gain

c.Journalize the entry to record the sale. If an amount box does not require an entry, leave it blank.

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