3. On January 1, 2003, Romer Manufacturing Company purchased equipment for $95,000. Romer paid $2,000 to have the machine installed.  The equipment is expected to have a 5-year useful life and a salvage value of $7,000.

​Required:

​(a.) Compute depreciation expense for 2003 and 2004 using straight line depreciation.

​(b.) What is the book value at the beginning of 2005?

​(c.) Assume the equipment was sold on Jan 1, 2005, for $65,000.

​Compute the amount of gain or loss from the sale.

​(d.) Prepare the journal entry to record the sale of the equipment.