During the current year, Hitchcock Developers disposed of plantassets in the following transactions.

Feb.	10		Office equipment costing $24,000 was given to a scrap dealer atno charge. At the date of disposal, accumulated depreciation on theoffice equipment amounted to $21,800.
Apr.	1		Hitchcock sold land and a building to Claypool Associates for$900,000, receiving $100,000 cash and a 5-year, 9 percent notereceivable for the remaining balance. Hitchcock’s records showedthe following amounts: Land, $50,000; Building, $550,000;Accumulated Depreciation: Building (at the date of disposal),$260,000.
Aug.	15		Hitchcock traded in an old truck for a new one. The old truckhad cost $26,000, and its accumulated depreciation amounted to$18,000. The list price of the new truck was $39,000, but Hitchcockreceived a $10,000 trade-in allowance for the old truck and paid$28,000 in cash. Hitchcock includes trucks in its Vehiclesaccount.
Oct.	1		Hitchcock traded in its old computer system as part of thepurchase of a new system. The old system had cost $15,000, and itsaccumulated depreciation amounted to $11,000. The new computer’slist price was $8,000. Hitchcock accepted a trade-in allowance of$500 for the old computer system, paying $1,500 down in cash andissuing a 1-year, 8 percent note payable for the $6,000 balanceowed.

Required:
a. Prepare journal entries to record each of thedisposal transactions. Assume that depreciation expense on eachasset has been recorded up to the date of disposal. Thus, you neednot update the accumulated depreciation figures stated in theproblem.

b. Do gains and losses on asset disposalsaffect gross profit?