Timmins Distribution is a large warehousing and distribution company that operates throughout Eastern Canada. Timmins Distribution uses the UOP method to amortize its trucks because its managers believe UOP amortization best measures the wear and tear on the trucks. Timmins Distribution trades in used trucks often to keep driver morale high and to maximize fuel efficiency. Consider these facts about one Mack truck in the company's fleet: When acquired in 2010, the tractor/trailer rig cost $585,000 and was expected to remain in service for eight years, or 1,500,000 kilometres. Estimated residual value was $60,000. The truck was driven 150,000 kilometres in 2011, 195,000 kilometres in 2012, and 235,000 kilometres in 2013. After 100,000 kilometres in 2014, the company traded in the Mack truck for a Freightliner rig with a fair market value of $500,000. Timmins Distribution paid cash of $40,000. This trade-in will bring in significantly more income to Timmins by reducing operating cost. Determine Timmins Distribution's cost of the new truck. Prepare the journal entry to record the trade-in.