Question - New tire retreading equipment, acquired at a cost of $144,000 at the beginning of a fiscal year, has an estimated useful life of four years and an estimated residual value of $10,800. The manager requested information regarding the effect of alternative methods on the amount of depreciation expense each year. On the basis of the data presented to the manager, the double-declining -balance method was selected.
In the first week of the fourth year, the equipment was sold for $19,750.
Question: Illustrate the effects on the accounts and financial statements of the sale.