Steph Curry Co$.$ had a machine that cost $$240,000$ on January $1,2019.$ This old machine had an estimated life of ten years and salvage value of $$40,000.$ On April $1,2024,$ the old machine is exchanged for a new machine with an appraised value of $$120,000.$ The exchange lacked commercial substance. Steph Curry Co$.$ also received $$30,000$ cash. Assume that the last fiscal period ended on December $31,2023,$ and that straight$-$line depreciation is used.

Instructions

$($a$)$ Show the calculation of the amount of the gain or loss to be recognized by Steph Curry.

$($b$)$ Prepare all entries that are necessary on April $1,2024.$ Show a check of the amount recorded for the new machine.