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Equipment acquired on January $8$ at a cost of $$168,000$ has an estimated useful life of $18$ years, has an estimated residual value of $$15,000,$ and is depreciated by the straight$-$line method.

a$.$ What was the book value of the equipment at December $31$ the end of the fourth year?

$

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Book value is the initial cost of the fixed asset minus the accumulated depreciation.

b$.$ Assume that the equipment was sold on April $1$ of the fifth year for $$125,000.$

Journalize the entry to record depreciation for the three months until the sale date. If an amount box does not require an entry, leave it blank.

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The depreciation account of the fixed asset being sold or discarded needs to be updated to reflect the months of use in the year it is being discarded or sold. The straight$-$line method of depreciation calculates the amount of depreciation to be recognized each year.

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

$$ Accumulated Depreciation$-$Equipment $$

$$

$$

Loss on Sale of Equipment

$$