The following transactions, adjusting entries, and closing entries were completed by Trailways Furniture Co. during a three-year period. All are related to the use of delivery equipment. The declining-balance method (at twice the straight-line rate) of depreciation is used.

2005
Jan. 2 Purchased a used delivery truck for $39,000 paying cash.
5 Paid $1,250 for a new transmission for the truck. (Debit Delivery Equipment)
Apr. 7 Paid garage $125 for changing the oil, replacing the oil filter, and tuning the engine on the delivery truck.
Dec. 31 Recorded depreciation on the truck for the fiscal year. The estimated useful life of the truck is 8 years, with a residual value of $250.

2006
Jan. 1 Purchased a new truck for $80,000, paying cash.
Mar. 13 Paid garage $180 to tune the engine and make other minor repairs on the truck.
Mar. 31 Sold the used truck for $24,500. (Record depreciation to date in 2006 for the truck.)
Dec. 31 Recorded depreciation on the remaining truck. It has an estimated residual value of $2,000 and an estimated life of 10 years.

2007
July 1 Purchased a new truck for $45,000, paying cash.
Oct. 2 Sold the truck purchased Jan. 1, 2006, for $69,075. (Record depreciation for the year.)
Dec. 31 Recorded depreciation on the remaining truck. It has an estimated residual value of $4,500 and an estimated useful life of 10 years.

Instructions
Record the transactions and the adjusting entries.