Pleasant Breeze owns three company cars, with one car replaced every three years always during December. The 2004 Toyota Camry is replaced today with a 2007 Honda Accord. The company paid $28,000 for the Honda. Pleasant Breeze pays 10% down and signs a five year, 3% note for the balance with Honda credit.
The Toyota was purchased for $24000 cash in 2004. When the car was put in service its expected life was 120,000 miles with an expected salvage value of $8400. The company sold the Toyota to an outside buyer at $10500. Pleasant Breeze Fan Company depreciates its cars using Units of Production (see the Units of Production handout in Doc Sharing / Student Resources. The Camry was driven 56000 miles the first two years, and has been driven 25000 miles in 2007.

Please read this first.

Announcement: (https://www.askmehelpdesk.com/finance-accounting/announcement-font-color-ff0000-u-b-read-first-expectations-homework-help-board-b-u-font.html)

First compute the book value of the Camry. Using this info, compute the gain or loss. If you show your work, we can let you know if you are doing it correctly. Second, write out your entry for the new vehicle and we can check to see you understand. Thanks.