Swann Company sold a delivery truck on April 1, 2016. Swann had acquired the truck on January 1, 2012, for $39,500. At acquisition, Swann had estimated that the truck would have an estimated life of 5 years and a residual value of $3,000. At December 31, 2015, the truck had a book value of $10,300.

Required:

Prepare any necessary journal entries to record the sale of the truck, assuming it sold for:

a.

$10,125

b.

$6,725

How should the gain or loss on disposal be reported on the income statement?

Assume that Swann uses IFRS and sold the truck for $10,125. In addition, Swann had previously recorded a revaluation surplus related to this machine of $4,000. What journal entries are required to record the sale?