Question: Disick Limited sold a piece of equipment July 1,2017 for proceeds of 24000.The equipment had an original vanlue of 53000 and was purchased on January 1,2015. It was estimated to have a residual value of $3000 and 5 years useful life. Disick uses the straignt line method. Disick has a December 31 year-end.
a. Journalize all depreciation entries for the equipment and record the sale of the asset in 2017.
b. Does this situation(gain or loss) at the time of disposal represent a significant error on the part of management? Expain you reasoning