Question: Jane Corp. owns equipment with an estimated residual value of $5,500 and an estimated useful life of 10 years. The equipment was purchased for $88,000 on January 1, four and a half years ago. Jane disposes of this equipment due to electrical malfunction. The company expects to receive no insurance recovery on the loss. Record the entries required on disposal of the equipment assuming that the disposal took place on July 1 of the current year and Depreciation was last updated on December 31 of the prior year.