Sunland Co. purchased equipment that was installed and ready for use at the beginning of January 2025 for a total cost of $1,204,000.The salvage value was estimated at $186,000. The machinery is depreciated over five years using the straight-line method. At December 31, 2027, the undiscounted expected future net cash flows were $532,000 and the discounted expected net cash flows were $478,800.

Assume that Sunland did not use the asset in 2028 and listed it for sale. At 12/31/28, the asset had a fair value of $532,000 and a disposal cost of $8,000. Prepare any journal entry needed at that date with regard to the asset.

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